Hurricane Ida Relief Extension
September 13, 2021
Dear valued client:
From all of us, we hope this letter finds you and your family well, and on the road to normalcy after so many of us were affected by Hurricane Ida. Now that we have power restored and getting back functioning normally, we wanted to reach out to cover some of tax relief items pertaining to you and/or your business tax filings/payments.
On August 31, 2021, the IRS announced disaster relieve under Treas. Reg. §301.7508A-1(d)(2) stating the following:
Louisiana — Victims of Hurricane Ida that began August 26, 2021 now have until January 3, 2022, to file various individual and business tax returns and make tax payments, the Internal Revenue Service announced today.
Following the recent disaster declaration issued by the Federal Emergency Management Agency, the IRS announced today that individuals and households who reside or have a business anywhere in the state of Louisiana will receive tax relief.
The declaration permits the IRS to postpone certain tax-filing and tax-payment deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after August 26, 2021, and before January 3, 2022, are postponed through January 3, 2022.
This means that individuals who had a valid extension to file their 2020 returns, due to run out on October 15, will now have until January 3, 2022 to file.
The January 3, 2022, deadline applies to the quarterly estimated tax payment, normally due on September 15, and the quarterly payroll and excise tax returns normally due on November 1, 2021. It also applies to tax-exempt organizations, operating on a calendar-year basis, that had a valid extension due to run out on November 15, 2021.
Also, penalties on deposits due on or after August 26, 2021, and before September 10, 2021, will be abated as long as the tax deposits were made by September 10, 2021.
If an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date that falls within the postponement period, the taxpayer should call the telephone number on the notice to have the IRS abate the penalty. For information on services currently available, visit the IRS operations and services page at IRS.gov/coronavirus.
The IRS automatically identifies taxpayers located in the covered disaster area and applies filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area should call the IRS disaster hotline at 866-562-5227 to request this tax relief.
Casualty Losses
Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either the year in which the event occurred, or the prior year. See Publication 547 for details.
Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. For details, see Form 4684, Casualties and Thefts and its Instructions.
Affected taxpayers claiming the disaster loss on a 2020 return should put the Disaster Designation, "Louisiana - Hurricane Ida" in bold letters at the top of the form. Be sure to include the disaster declaration number, FEMA 4611-DR, on any return. See Publication 547 for details.
Additionally, the Louisiana Department of Revenue followed the path of the IRS by granting automatic extensions to January 3, 2022. This is a fluid situation and there will likely be additional provisions put into law, similar to prior disaster area declarations. We will monitor the situation and relay the information accordingly.
In the interim, if you have a specific question or need assistance, please do not hesitate to contact us.
Respectfully,
The Taylor & Matthews, CPAs Team