If you were impacted by Hurricane Helene, the IRS has some important news that you ought to hear. Given the destruction wreaked by the hurricane, the Internal Revenue Service has declared tax relief for individuals and companies in the State of Alabama who have been affected. This follows the declaration of a disaster by the Federal Emergency Management Agency, FEMA. Here’s a summary of eligibility criteria and what regions are included along with other information on the new tax filing time limits.
Who Qualifies for IRS Tax Relief?
As a result of the destruction brought on by Hurricane Helene, all 67 counties in the state of Alabama are contained within the IRS tax relief program. You are eligible for this relief if you live or have a business in any of such counties. The IRS has also granted taxpayers in these areas an extension of the deadlines for tax filings and payments so that people can recover without the concern of paying taxes shortly.
Even if you are not located within the vicinity of the calamity, and your tax documents or the information needed to complete the tax return is situated in that area, you may still be eligible for the benefits. In this situation, it would be advisable to contact the IRS disaster hotline at 866-562-5227 to get more directions.
What Are the New Tax Filing Deadlines?
Should Hurricane Helene have affected you, the Internal Revenue Service has announced that tax filing and payments have been extended to May 1, 2025, without the need for special requests. This extension applies to:
- Persons and entities that are due to submit tax returns for the year 2024 in March or April 2025.
- Individuals who filed for an extension of the filing period for individual tax returns for the year 2023 are to be on or before October 15, 2024.
- Calendar-year corporations and these corporations had a 2023 extension which is expiring on 15th October 2024.
- This extension also encompasses estimated tax payments which would have been due on January 15 and April 15, 2025, as well as quarterly payroll and excise tax returns which would have been due on October 31, 2024, January 31, 2025, and April 30, 2025, respectively.
- One important thing to note is that although 2023 tax returns may be extended, the related payments were due on April 15, 2024, and so those payments do not fall under this relaxation.
Penalties for Late Payments and Deposits
The IRS will also eliminate penalty fees for specific deposits of payroll and excise taxes. All payroll or excise tax deposits due after September 22, 2024, and before October 7, 2024, will not be penalized provided the deposit is made by October 7.
If you have already been issued a penalty notice by the IRS for a late payment or a late deposit that falls within the period mentioned above, there is no need to worry. Ring the number appearing on the notice and explain the situation, then ask for the penalty to be lifted.
Taxpayers Outside the Disaster Area
Suppose you’re a tax preparer who services clients outside of Alabama, however, you have clients in the disaster-stricken area. In that case, the IRS has relief options available to you as well. For instance, you may access the Bulk Request tool within the IRS portal to request disaster relief simultaneously for more than one client.
Further, if you have resources and are performing construction or other types of work in the area where the disaster has been declared, even as a volunteer, you also qualify for the same tax relief extended to tax-payers such as yourself.
Claiming Disaster-Related Casualty Losses
Losses about the impact of the hurricane are also permissible for the taxpayers residing in the disaster-stricken zone, who may wish to include them in their federal tax return. This can either be done in the tax year 2024 (which would typically be submitted next year) or in the already submitted tax year 2023.
To claim these disaster losses, it is worth noting that you need to complete and attach Form 4684, “Casualties and Thefts,” when submitting your return. To assist the IRS in adjudicating your claim appropriately, include the FEMA disaster declaration number in your tax returns: FEMA-3618-EM.
If you do not receive any insurance or any other compensation for these losses, as a last resort you may be allowed to deduct the loss from your income. However, ensure that you check IRS Publication 547 for guidance on how to claim such losses.
Additional Relief for Taxpayers
The Internal Revenue Service is doing more than just providing extensions of deadlines. If for instance you have been affected by the hurricane, you can ask the IRS for copies of your tax returns for the years you have filed without paying the normal fees. To do this, file Form 4506 or Form 4506-T but this time round you will have to include the FEMA declaration number (3618-EM) on your form.
Another benefit includes qualified disaster relief insurance payments. These payments as the name suggests are paid to you to cover expenses such as repairs or even accommodation but are typically not included in the calculation of gross income. This means that you do not report them as income on your federal tax return.
Lastly, for all those who have a pension plan or an IRA and should need access to funds in case of emergencies, the IRS included measures that allow special disaster distributions without the usual 10% penalty on early distributions. You also have the option of spreading the income from this distribution for three years.
How to Get Help Filing Your Return
If you qualify for tax relief but require help in the tax filing process, there is an option for assistance at no charge. The Volunteer Income Tax Assistance (VITA) program and Tax Counseling for the Elderly (TCE) offer free assistance with tax-related issues to those individuals and households earning less than $79000.
On the other hand, where one prefers to file by oneself, the Internal Revenue Service has a provision called Free File to assist those with an adjusted gross income of less than $79000. There is also a provision referred to as Free File Fillable Forms that enables users to file their federal tax forms electronically.
For most servicemen and veterans as well, the Department of Defense has a program called MilTax which allows for the filing of state and federal taxes without any maximum income restrictions.
Utilizing any of these relief measures allows you to recover from the calamity without having to worry about the due dates for taxes or penalties for late filing. The Internal Revenue Service knows the difficulties you are facing and would like to provide you with these resources to assist you in returning to your normal self.
- Read more: A taxpayer shares an IRS letter notice and the responses go viral: “How much trouble am I in?”
- Read more: One U.S. state is already activating LIHEAP for the payment of heating expenses as of Oct. 1: you can apply to pay no more than 6% of your income
- Read more: IRS warning with scams linked to the Offer in Compromise (OIC) program: “A few cents on the dollar”
