IRS Announces Tax Relief for Victims of California Wildfires and Hurricane Ida and Urges Individuals to Prepare for Natural Disasters
Edward A. Zurndorfer-
September has been designated as National Preparedness Month. With the height of hurricane season currently upon us and the continuing threat of wildfires throughout most of the western part of the U.S., the IRS reminds every individual and family to develop an emergency preparedness plan.
Before discussing the specifics of developing an emergency preparedness plan, it is important to review two recent IRS announcements affecting the victims of the California wildfires and Hurricane Ida.
Tax Relief for Victims of California Wildfires
Victims of wildfires that began July 14,2021 now have until November 15,2021 to file individual and business tax returns and make tax payments that have filing and payment deadlines respectively any time beginning after July 14 and ending November 14, 2021. Following the recent disaster declaration issued by the Federal Emergency Management Agency (FEMA), the IRS announced that affected areas will receive tax relief.
Individuals and household affected by wildfires that reside or a business in Loosen Nevada, Places and Plumas County in California qualify for tax relief. The declaration permits the IRS to postpone certain tax-filing and tax-payment deadlines for individuals who reside or have a business in the disaster areas. In particular, certain filing deadlines, falling on or after July 14,2021 and before November 15, 2021, are postponed until November 15, 2021.
This means that individuals who had a valid extension to file heir 2020 Federal income tax returns (due October 15, 2021) will now have until November 15,2021 as a due date. The November 15,2021 deadline also applies to the third Federal estimated tax payment (normally due September 15, 2021) is now due November 15, 2021.
Tax Relief for Victims of Hurricane Ida
The IRS announced that victims of Hurricane Ida that began on August 31,2021 now have until January 3,2022 to file various and individual business tax returns and make tax payments. The IRS is offering this relief to any area designated by FEMA as qualifying for individual or public assistance such as the entire state of Louisiana. Individuals in the impacted areas of Connecticut, Pennsylvania, New Jersey and New York (including New York City) will receive the same filing and payment tax relief as the residents of Louisiana. The current list of eligible localities is available on the “disaster relief” page at www.irs.gov.
The tax relief postpones various tax filing and payment deadlines that occurred starting on August 26, 2021. As a result, affected individuals will have until January 3,2022 to file returns and pay the taxes that were originally due during this period.
This means that individuals who had a valid extension to file their 2020 federal income tax returns (originally due Oct. 15, 2021) will now have until January 3, 2022. The January 3,2022 filing deadline also applies to quarterly estimated income tax payments due on Sept. 15, 2021. The IRS disaster relief page has details on other returns, payments and tax-related actions qualifying for the additional time.
IRS Urges Individuals to Prepare for Natural Disasters
The IRS has designated September as National Preparedness Month. With the height of hurricane season upon us and the ongoing threat of wildfires in several parts of the country, the IRS reminds ever individual to develop an emergency preparedness plan. All individuals and businesses should take time now to create or update their emergency plans.
Individuals can begin getting ready for a disaster with a preparedness plan that includes securing and duplicating essential tax and financial documents, creating lists of property, taking pictures of such items as valuable heirlooms, and knowing where to find information once a disaster has occurred. Securing this information can help in the aftermath of a disaster- whether it is a fire, flood, hurricane, tornado, or severe and damaging thunderstorms, and it can help individuals more quickly take advantage of disaster relief available from the IRS.
The following are some particular suggestions to “disaster-proof” one’s personal items and documents:
· Start “secure”. Individuals should keep critical original documents inside waterproof containers in a secure space. Documents including tax returns, birth certificates, deeds, titles and insurance policies should also be duplicated and kept with a trusted person outside the area a natural disaster may affect.
· Make copies. If original documents are available only on paper, individuals can use a scanner and save them on a USB flash drive, CD or in the Cloud, which provides security and easy portability.
· Document valuables. After a disaster lists, photographs and videos of a home or business’s contents can help support claims for insurance or tax benefits. All property, especially expensive and high-value items, should be recorded. The IRS “disaster-loss” workbooks can help individuals and businesses compile lists of belongings or business equipment.
Individuals can get additional assistance on disaster preparedness by going to the IRS website at www.irs.gov and download the following: (1) Publication 2194 (Disaster Resource Guide for Individuals and businesses): (2) Publication 547 (Casualties, Disasters, and Thefts); and (3) the document – Reconstructing Records After a Natural Disaster or Casualty Disaster. Affected individuals of a natural disaster are encouraged to check the website and the FEMA website.
Edward A. Zurndorfer is a CERTIFIED FINANCIAL PLANNER™ professional, Chartered Life Underwriter, Chartered Financial Consultant, Chartered Federal Employee Benefits Consultant, Certified Employees Benefits Specialist and IRS Enrolled Agent in Silver Spring, MD. Tax planning, Federal employee benefits, retirement and insurance consulting services offered through EZ Accounting and Financial Services, and EZ Federal Benefits Seminars, located at 833 Bromley Street – Suite A, Silver Spring, MD 20902-3019 and telephone number 301-681-1652. Raymond James is not affiliated with and does not endorse the opinions or services of Edward A. Zurndorfer or EZ Accounting and Financial Services. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional.
