The IRS has recently announced a tax relief for both individuals and businesses in disaster affected areas. Those who live within these affected areas and were affected by the severe storms and natural disaster are allowed an extension. These affected taxpayers now have until February 3rd, 2025 to submit their income tax returns and pay any of their taxes that is due. This extension is intended to provide additional time for recovering taxpayers thus helping them put their lives back on track after experiencing the financial hardship caused by the natural disaster.
Areas covered by the extension
This momentary tax relief is available for people and companies in areas which have been specified as federal disaster regions by the Federal Emergency Management Agency (FEMA). You do not need to file your tax return since you are given an extension automatically if you live or do business in these areas. Some of the important areas are:
- Louisiana: Affected by hurricane Francine in September 2024.
- New York: This area was affected by violent storms and flooding in August 2024.
Thus, if your locality was set aside officially by FEMA as a disaster zone, then this extension applies to you as well. Taxpayers’ records showing that they resided in the area would ensure that the IRS offers you this relief automatically.
Tax filing and payment deadlines affected
The new February 3, 2025, deadline covers a variety of tax-related obligations, including:
- Individual tax returns: Those who received an extension to file their 2023 tax return (which was originally due in October 2024) will now have until February 3, 2025, to file. However, it’s important to note that this extension does not apply to any payments that were due in April 2024.
- Business tax returns: Businesses with deadlines between August 2024 and February 2025, including partnerships, S corporations, and corporations, are also eligible for the extension. This includes businesses with an extended due date that originally fell in September or October 2024.
- Quarterly estimated payments: Quarterly estimated tax payments due on September 16, 2024, and January 15, 2025, are now extended until February 3, 2025. This gives individuals and businesses additional breathing room during a time of recovery.
- Payroll and excise taxes: Quarterly payroll and excise tax returns due in October 2024 and January 2025 also fall under the new deadline. Additionally, penalties on payroll and excise tax deposits between August 18 and September 3, 2024, will be waived as long as payments are made by September 25, 2024.
Additional relief for disaster victims
Taxpayers in disaster areas may be eligible for further relief beyond the extended deadlines. For example:
- Uninsured losses: If you experienced property losses that were not covered by insurance, you may be able to claim these losses on either your 2023 or 2024 tax return. This decision can be made up until October 15, 2025.
- Casualty losses: The IRS allows taxpayers to claim casualty losses on their federal income tax returns for either the year of the disaster or the prior year. Affected taxpayers can review Form 4684 for more information on reporting such losses.
- Retirement account withdrawals: The IRS may offer some leniency on early withdrawals from retirement accounts for those affected by the disaster. Special disaster distributions are often available that allow for penalty-free withdrawals.
How to access IRS Relief
If your area is identified by the IRS as being among the disaster areas then you do not have to file any additional paperwork, your relief is going to be automatically. However, if you’ve moved or believe you qualify but haven’t received it then contact the IRS disaster hotline at 866-562-5227.
For eligible businesses whose records are stored in disaster regions even when the business itself is not located these days in disaster areas, they might be eligible if affected people visit the IRS website to monitor any updates concerning.
In periods of natural disasters, financial recovery could take a long time. These extensions provide affected taxpayers with an opportunity to sort their tax responsibilities while dealing with aftermaths.
