Taxpayers affected by Hurricane Sally have been given tax relief by the Internal Revenue Service. They now have until Jan. 15, 2021 to file various individual and business returns and make payment of tax due.
The IRS is offering the relief to areas designated qualified for individual disaster assistance by the Federal Emergency Management Agency (FEMA). At present, Baldwin, Escambia and Mobile counties in Alabama have been so designated, but taxpayers in locations that are added later to the disaster declaration – whether in Alabama or other neighboring states – will automatically get the same filing and payment relief.
The current list of eligible locations is always available on the disaster relief page on IRS.gov.
The tax relief postpones various tax filing and payment deadlines that occurred, starting on Sept. 14, 2020. As a result, affected individuals and businesses will have until Jan. 15, 2021, to file returns and pay any taxes that were originally due during this period.
This means individuals who had a valid extension to file their 2019 return due to run out on Oct. 15, 2020, will now have until Jan. 15, 2021, to file.
The IRS notes, however, that because tax payments related to these 2019 returns were due on July 15, 2020, those payments are not eligible for this relief.
Quarterly tax payments were extended.
The Jan. 15, 2021 deadline also applies to quarterly estimated income tax payments due on September 15, 2020, and the quarterly payroll and excise tax returns normally due on November 2, 2020. It also applies to tax-exempt organizations that operate on a calendar-year basis that had a valid extension due to run out on November 16. Businesses with extensions also have additional time including, among others, calendar-year corporations whose 2019 extensions run out on October 15.
In addition, penalties on payroll and excise tax deposits due on or after Sept. 14 and before Sept. 29 will be abated as long as the deposits are made by September 29.
For details on other returns, payments and tax-related actions qualifying for the additional time, see the IRS disaster relief page on IRS.gov.
Do not call the IRS!
The IRS automatically applies filing and penalty relief to any taxpayer with an address on file with the agency that’s located within the disaster area. Taxpayers don’t need to contact the IRS in order to get the relief.
If a taxpayer within the disaster area gets a late-filing or late-payment penalty notice from the IRS with an original or extended filing, payment or deposit due date falling within the postponement period, the taxpayer can call the phone number on the notice to have the penalty abated.
The IRS will also 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 disaster area.
Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.
How do you claim disaster-related losses?
Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2020 return normally filed next year), or the return for the prior year (2019).
Taxpayers should write the FEMA declaration number – 4563 − for Hurricane Sally in Alabama on any return claiming a loss. Publication 547 has details.