Section 83(b) Deadline Extended to July 15, 2020

BOSTON – We always remind our clients and co-counsel that a Section 83(b) election must be postmarked within 30 calendar days after the date the restricted property (usually unvested stock) was granted. And we're quick to point out that this 30-day deadline is hard and fast -- no grace periods. That’s a slight oversimplification, because there are rare exceptions that we rarely consider, such as where the recipient is serving in the Armed Forces (or in support of the Armed Forces) in a combat zone, or the recipient is affected by terrorist or military action, or . . . a presidentially declared disaster.

You know where we’re going with this. President Trump’s designation of the COVID-19 pandemic as a national disaster has triggered the IRS’s authority under Section 7508A of the Internal Revenue Code to extend certain tax-related deadlines. Under IRS Notice 2020-23, the deadline for certain “time-sensitive actions” due to be performed on or after April 1, 2020 and before July 15, 2020 are automatically postponed until July 15, 2020. This includes Section 83(b) elections.

Accordingly, the deadline for any Section 83(b) election otherwise required to be filed on or after April 1, 2020 and before July 15, 2020 is automatically postponed until July 15, 2020, without any action required by the taxpayer.

As always, this summary is for informational purposes only and is not tax or legal advice. Always consult a professional tax advisor for advice in light of the taxpayer’s particular circumstances.

For more information on Section 83(b) elections, please see our prior Q&A post or contact:

Christopher Bird
CBird@BlaisTaxLaw.com

Travis Blais
TBlais@BlaisTaxLaw.com