United States

IRS announces tax relief for California wildfires

The announcement postpones certain tax deadlines

TAX ALERT  | 

On Oct. 13, 2017, the IRS published IR-2017-172, which provides tax relief to taxpayers in certain counties in the State of California that were impacted by the recent outbreak of wildfires.

The relief granted by the IRS applies to the California counties of Butte, Lake, Mendocino, Napa, Nevada, Sonoma and Yuba counties, and automatically applies to taxpayers whose address of record with the IRS is located therein.

Like tax relief for other major disasters, the tax relief extends to taxpayers not located within the declared disaster area but whose records necessary to meet a tax filing deadline are located within the impacted California counties. These taxpayers include firefighters and workers assisting the relief efforts who are affiliated with a recognized government or philanthropic organization. All qualifying taxpayers with an address outside of the impacted areas need to contact the IRS at 866-562-5227.

Grant of Relief

The tax relief postpones various tax filing and payment deadlines due on or after Oct. 8, 2017. Like other recent disaster relief announcements, it postpones filing and payment deadlines until Jan. 31, 2018, for affected individuals and businesses. The relief includes postponed filing deadlines for individuals who received a tax-filing extension until Oct.16, 2017. It does not include these individuals’ tax payments, which were due April 18, 2017.

Additional delayed filing deadlines include the October 31 deadline for quarterly payroll and excise tax returns and the filing deadline for calendar-year tax-exempt organization whose extended filing deadline is November 15.

The IRS will waive any late-deposit penalties for federal payroll and excise tax deposits normally due after Oct. 8, 2017, and before Oct. 23, 2017, if the deposits are made by Oct. 23, 2017.

Individuals and businesses who suffered uninsured or unreimbursed disaster-related losses can chose to claim them on either the year the loss occurred (e.g., 2017) or the return for the prior year (2016). For more information on the loss deduction, see IRS Publication 547.

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