On Saturday, the IRS issue an announcement (IR-2018-187) saying it is extending tax filing and payment deadlines for taxpayers and businesses in the following North Carolina counties that were hardest hit by Hurricane Florence and that have been designated as qualifying for individual assistance by the Federal Emergency Management Agency: Beaufort, Brunswick, Carteret, Craven, New Hanover, Onslow, Pamlico, and Pender. This relief was announced in and by a new Help for Victims of Hurricane Florence IRS disaster relief page. The IRS often updates these pages after a disaster and adds other counties that qualify for relief, so taxpayers should check that page for updates.
The IRS explained that this tax relief postpones certain tax filing and payment deadlines that occurred starting on Sept. 7, 2018, in North Carolina, including quarterly estimated income tax payments due on Sept. 17, 2018, and quarterly payroll and excise tax returns normally due on Oct. 31, 2018. Affected individuals and businesses will have until Jan. 31, 2019, to file returns and pay any taxes that were originally due during this period.
Businesses with filing extensions also have until Jan. 31, 2019, including calendar-year partnerships that have extensions to file their 2017 tax return until Sept. 17, 2018. This relief also extends to taxpayers who had a valid extension to file their 2017 tax return until Oct. 15, 2018. They will have until Jan. 31, 2019, to file.
The IRS is also abating any penalties on payroll and excise tax deposits due on or after Sept. 7, 2018, and before Sept. 24, 2018, so long as the deposits are made by Sept. 24, 2018.
Because the IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record in the disaster area, taxpayers do not have to contact the IRS to get this relief. However, 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 falling within the postponement period, the taxpayer should call the number on the notice to have the penalty abated.
The IRS also said it will work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline are located in the affected area. Those taxpayers must contact the IRS at 866-562-5227. The IRS indicated that the advice to call the IRS requesting relief also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.
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 (the 2018 return filed in 2019) or on last year’s return (2017, filed in 2018).
In addition, the IRS noted on its Hurricane Florence disaster relief page that taxpayers who suffer personal casualty losses in certain federally declared disaster areas may claim these losses as qualified disaster losses, a change to the disaster relief law from P.L. 115-97, known as the Tax Cuts and Jobs Act, which eliminated the deduction for personal casualty losses for all taxpayers outside federally declared disaster areas.
— Sally P. Schreiber, J.D., (Sally.Schreiber@aicpa-cima.com) is a Tax Adviser senior editor.