The Internal Revenue Service (IRS) announced recently that individuals and businesses affected by Hurricane Helene in parts of seven states will receive tax relief, including extended filing deadlines and payments. This assistance applies to all states of Alabama, Georgia, North Carolina, and South Carolina, as well as parts of Florida, Tennessee, and Virginia.
Taxpayers in these areas now have time May 1, 2025filing various individual and corporate tax returns and paying taxes. This includes 2024 individual and corporate returns normally due in March and April of 2025, 2023 individual and corporate returns subject to allowable extensions, and quarterly estimated tax payments.
The IRS provides this relief in any location designated by the Federal Emergency Management Agency (FEMA). Currently, this includes all of Alabama, Georgia, North Carolina, and South Carolina, as well as 41 counties in Florida, eight counties in Tennessee, and six counties and one city in Virginia. The IRS noted that additional areas may be added as FEMA disaster declarations are made.
Important Relief Provisions
The tax exemption postpones the various filing and payment deadlines that started on:
- September 22, 2024in Alabama
- September 23, 2024in Florida
- September 24, 2024in Georgia
- September 25, 2024North Carolina, South Carolina, and Virginia
- September 26, 2024in Tennessee
As a result, concerned people and businesses will find out May 1, 2025filing returns and paying any taxes originally due during this period. This includes:
- 2024 returns in March or April 2025 for individuals and businesses.
- 2023 federal returns subject to allowable extensions (note: payments for these refunds are still due as originally scheduled, as they were due before the storm).
- Estimated quarterly income tax payments because of January 15, 2025again April 15, 2025.
- Quarterly payroll and excise tax returns because of October 31, 2024, January 31, 2025again April 30, 2025.
Additionally, the IRS will provide penalty relief to businesses that pay and deposit excise taxes. Details of assistance times vary by state, and more information is available at Cross country IRS.gov page.
Auto Help and Additional Help
The IRS will automatically process filing and penalty relief for taxpayers with an IRS address of record in the disaster area. These taxpayers do not need to contact the IRS for assistance.
For taxpayers who may have moved to a disaster area after filing their returns or who receive late payment penalty notices, the IRS advises contacting the number on the notice to request a penalty reduction.
The IRS also provides assistance to taxpayers located outside the disaster area if their records needed to meet deadlines are located in the affected area. These people should contact the IRS at 866-562-5227. Additionally, tax preparers with clients outside of the disaster zone can use it Many Requests from Disaster Relief Workers option at IRS.gov.
Additional Tax Relief for Catastrophic Losses
Individuals and businesses in a state-declared disaster area with uninsured or uninsured losses may choose to claim these losses on their 2024 return or on their 2023 return. Taxpayers have until October 15, 2025to make this choice. When claiming a disaster loss, taxpayers must include the FEMA declaration number on their return.
Eligible disaster relief payments are generally not included in gross income. These payments, which include necessary expenses for personal, family, living, or funeral expenses, as well as home maintenance, are tax-free. More details can be found at Publication 525dealing with taxable and non-taxable income.
Taxpayers may also have access to additional relief if they participate in a retirement plan or individual retirement plan (IRA). This may include the ability to take special risk distributions without facing the 10% early distribution tax, or to make hardship withdrawals. Taxpayers should refer to their retirement plan for specific rules and guidance.
The IRS may announce additional disaster relief measures in the future.
