United States

IRS announces tax relief related to Hurricane Irma

TAX ALERT  | 

On Sept. 12, 2017, the IRS issued FL-2017-04, directed towards taxpayers affected by Hurricane Irma. According to the information release, Hurricane Irma victims in parts of Florida have until Jan. 31, 2018, to file certain individual and business tax returns and make certain tax payments.

Currently, according to the release, the counties eligible for relief are: Brevard, Broward, Charlotte, Clay, Collier, Duval, Flagler, Hillsborough, Lee, Manatee, Miami-Dade, Monroe, Orange, Palm Beach, Pasco, Pinellas, Polk, Putnam, Sarasota, St. Johns and St. Lucie. These Florida counties effected by Hurricane Irma and receiving relief are in addition to previously announced tax relief for the islands of St. John and St. Thomas in the U.S. Virgin Islands and the municipalities of Culebra, Vieques, Canóvanas and Loíza in Puerto Rico.

The IRS will be updating the list of affected counties in the days to come and we will be issuing prompt updates to this alert.

Grant of Relief

Pursuant to FL-2017-04, the tax relief postpones various tax filing and payment deadlines due on or after Sept. 4, 2017. As a result, affected individuals and businesses will have until Jan. 31, 2018, to file returns and pay any taxes that were originally due during this period, which includes the Sept. 15, 2017, and Jan. 16, 2018, deadlines for making quarterly estimated tax payments. For individual tax filers, the relief also includes 2016 income tax returns that received a tax-filing extension until Oct. 16, 2017.

The IRS provides relief for the October 31 deadline for filing of quarterly payroll and excise tax returns. The IRS is also waiving late-deposit penalties for federal payroll and excise tax deposits normally due on or after Sept. 4, 2017, and before Sept. 19, 2017, if the deposits are made by Sept. 19, 2017.

Taxpayers located in the Disaster Area

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. Therefore, taxpayers need not contact the IRS to get this relief. However, if an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date falling within the postponement period, the taxpayer should call the number on the notice to have the penalty abated.

Taxpayer Records or Taxpayer Return Preparer Located in Disaster Area

In addition, the IRS provides relief to any taxpayer who lives outside the disaster area but whose records, necessary to meet a filing deadline occurring during the postponement period, are located in the affected area. This provision extends to those situations in which the taxpayers are not located in the disaster areas, but their accountants, in the possession of the work papers and tax documents, are. It is recommended that the affected taxpayers making the late submission state on the face of the return of the Form they are filing that although the filing is late, relief is available per FL-2017-04.

Practitioners located within the declared disaster area with 10 or more clients outside of the disaster area should prepare an electronic spreadsheet loaded on a CD. Column A of the spreadsheet should state the client’s Tax Identification Number, Social Security Number or Employer Identification Number. Column B should state, in capital letters, the first four letters of the client’s name.  With the enclosed CD, the preparer should include a cover letter stating why it cannot timely file the clients’ returns. The enclosed CD and cover letter should be mailed to:

Special Sevices Section
1 Independence Drive, Ste 500
Stop 600
Jacksonville, FL 32202

Taxpayers and practicioners not in the disaster areas, but affected by Hurricane Irma can call (800) 829-4933 for more guidance.

The relief is also available to workers assisting the relief activities who are affiliated with a recognized governmental or philanthropic organization.

Individuals and businesses who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2017 return normally filed next year), or on the return for the prior year (2016). See Publication 547 for details.

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