With hours to go before the filing deadline, the IRS has further postponed tax deadlines for most California taxpayers to Nov. 16, 2023. “Further” is a key word—due to the winter storms that hit the Golden State earlier this year, the normal spring due dates had previously been postponed to Oct. 16, 2023.
Fifty-five of California’s 58 counties—all except Lassen, Modoc and Shasta counties—qualify. IRS relief is based on three different FEMA disaster declarations covering severe winter storms, flooding, landslides, and mudslides over a period of several months. You can find out more information here.
The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA). The current list of eligible localities is always available on the disaster relief page on IRS.gov.
Filing and Payment Relief
The tax relief postpones various tax filing and payment deadlines until Nov. 16, 2023, to file their 2022 returns and pay any tax due.
Eligible returns and payments include 2022 individual income tax returns and payments normally due on April 18, 2023, as well as 2022 contributions to IRAs and health savings accounts for eligible taxpayers.
The IRS is granting more time for individual taxpayers to pay quarterly estimated income tax payments normally due on April 18, 2023, June 15, 2023, and Sept. 15, 2023.
Businesses are also entitled to relief. That includes businesses that normally file quarterly payroll and excise tax returns on May 1, 2023, July 31, 2023, and Oct. 31, 2023. It also includes 2022 calendar-year partnerships and S corporations with returns normally due on March 15, 2023, as well as 2022 calendar-year corporate and fiduciary income tax returns and payments normally due on April 18, 2023.
Tax-exempt organizations get a break, too. Calendar-year tax-exempt organizations with returns normally due on May 15, 2023, are entitled to relief.
Other returns, payments and time-sensitive tax-related actions also qualify for the extra time. See the IRS disaster relief page for details.
How To Get Relief
Most taxpayers won’t need to do anything to get relief. The IRS automatically provides filing and penalty relief to taxpayers with an IRS address of record in the disaster area.
It is possible an affected taxpayer may not have an IRS address of record located in the disaster area—maybe you’ve moved, for example. If you’re entitled to relief, but receive a late filing or payment penalty notice from the IRS, you should call the number on the notice to have the penalty abated.
The IRS will work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline occurring during the postponement period are located in the affected area—this also includes relief workers affiliated with a recognized government or philanthropic organization. Those taxpayers need to contact the IRS at 1.866.562.5227.
Casualty Loss Deductions
As a result of the Tax Cuts and Jobs Act, casualty loss deductions are not available for most taxpayers. However, individuals and businesses who are in a federally declared disaster area are entitled to the deduction.
You can claim a casualty loss deduction on either the return for the year the loss occurred—that’s the 2023 return filed in 2024—or the return for the prior year—that’s the 2022 return normally filed in 2023. Taxpayers have up to six months after the due date of their income tax return for the disaster year (without regard to any extension of time to file) to make the election.
Additional relief may be available to affected taxpayers who participate in a retirement plan or individual retirement arrangement (IRA). For example, a taxpayer may be eligible to take a special disaster distribution that would not be subject to the additional 10% early distribution tax and allows the taxpayer to spread the income over three years. Taxpayers may also be eligible to make a hardship withdrawal. Check with your plan administrator since each plan or IRA has its own specific rules and guidance.
The tax relief is part of a coordinated federal response to the damage caused by these disasters and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.