The Internal Revenue Service (IRS) has announced victims of Hurricane Harvey and Hurricane Irma may qualify for tax relief. For those affected by the hurricanes, the IRS is allowing an additional filing extension for business taxpayers with valid extensions that expire on September 15, 2017 and individual taxpayers with valid extensions that expire on October 16, 2017.
Federal Tax Relief
Those affected have until January 31, 2018, to file
certain federal business and individual tax returns and pay any
taxes that were originally due during the impacted time periods.
However, because tax payments related to federal tax returns for
2016 were originally due by April 18, 2017, such payments are not
eligible for this relief. On the other hand, quarterly estimated
tax payments due on September 15, 2017, and January 16, 2018, are
eligible for this relief and victims have until January 31, 2018,
to make these payments as well.
Are You Eligible for Federal Tax Relief?
This extended due date is offered only to those victims
that reside in or have businesses in any area that has been
identified by the Federal Emergency Management Agency (FEMA) as
qualifying for individual assistance. For the most current
and updated list of impacted areas and applicable time periods,
please visit the IRS Disaster Relief Page, https://www.irs.gov/newsroom/tax-relief-in-disaster-situations.
State Tax Relief
State tax authorities are also offering state tax relief
to victims of these hurricanes. For example, the Georgia Department
of Revenue has announced relief to victims of Hurricane Harvey
similar to the relief offered by the IRS. As such, the Georgia
Department of Revenue is postponing the tax return filing deadlines
(and certain tax payments due within the impacted time periods) for
individuals and businesses until January 31, 2018. However, note
that this is state-level tax relief, not federal tax relief. It is
expected that similar state-level tax relief for victims of
Hurricane Irma will be made available by other affected
states. We suggest checking relevant state tax
authorities' websites to determine what, if any, tax relief is
available to victims of the hurricanes and to what extent.
Other Relief Items
Employer sponsored retirement plans can be used to make
loans and hardship distributions for victims and families in areas
impacted by the hurricanes. Hardship withdrawals must be made
by January 31, 2018.
A variety of business tax deadlines are also affected, including the Oct. 31 deadline for quarterly payroll and excise tax returns. The disaster relief page on www.irs.gov has details on other returns, payments and tax-related actions qualifying for the additional time.
The IRS is also waiving late-deposit penalties for federal payroll and excise tax deposits normally due during the first 15 days of the disaster period. Check out the disaster relief page for the time periods that apply to each jurisdiction.
If you have any questions about federal or state tax relief for hurricane victims, please contact your tax advisor or Alison Jasper, Principal, Tax Services, at 314.983.1276 or ajasper@bswllc.com.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
