California disaster relief tax filing extension

[Ember123]

It seems to me, with the latest IRS announcement, most California taxpayers may avoid the stress of filing March 15 and April 15 2023 income tax extensions. Comprende ?

[Username is two words]

Agreed.  March 15 and April 15 become May 15.  California conformed. Is that what you mean?  If you mean the new extension until October 15, California has not conformed, so far. So it doesn't do much good; the Fed returns still have to be prepared in order to do CA. But if the taxpayer owes money to the IRS he/she can wait until 10/15 to pay it without an extension.

Will CA conform? Who knows. The state is a June 30 year-end. If they conform, they still have to pay refunds to anyone who files for it but those who owe will have until Oct. 15. This seems like a recipe for disaster for the state budget. I guess we'll find out by May 15.

[Ember123]

This is a brilliant response and I understand and agree with every word. If I may, please, I have two more questions. Then I am done.

1. Would you agree that a qualifying CA individual that has already e-filed 2022 Form 1040 still could wait until October 15 2023 to pay the 2022 income tax due?

2.What is the primary source of information on this topic other than the IRS Newswire issue number 2-23-33?

Thank you.

[Username is two words]

Thanks!

#1: Absolutely. I have clients in that exact situation and I'm telling them they can choose to wait until October to pay their IRS balances due and estimates. 

Note it also applies to payroll tax RETURNS but not the payments.

#2: IR-2023-33, as you mentioned, is the source. 

IR-2023-33, Feb. 24, 2023

WASHINGTON — Disaster-area taxpayers in most of California and parts of Alabama and Georgia now have until Oct. 16, 2023, to file various federal individual and business tax returns and make tax payments, the Internal Revenue Service announced today. Previously, the deadline had been postponed to May 15 for these areas.

The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA) in these three states. There are four different eligible FEMA declarations, and the start dates and other details vary for each of these disasters. The current list of eligible localities and other details for each disaster are always available on the Tax Relief in Disaster Situations page on IRS.gov.

The additional relief postpones until Oct. 16, various tax filing and payment deadlines, including those for most calendar-year 2022 individual and business returns. This includes: Individual income tax returns, originally due on April 18; Various business returns, normally due on March 15 and April 18; and returns of tax-exempt organizations, normally due on May 15.

Among other things, this means that eligible taxpayers will also have until Oct. 16 to make 2022 contributions to their IRAs and health savings accounts.

In addition, farmers who choose to forgo making estimated tax payments and normally file their returns by March 1 will now have until Oct. 16, 2023, to file their 2022 return and pay any tax due.

The Oct. 16 deadline also applies to the estimated tax payment for the fourth quarter of 2022, originally due on Jan. 17, 2023. This means that taxpayers can skip making this payment and instead include it with the 2022 return they file, on or before Oct. 16.

The Oct. 16 deadline also applies to 2023 estimated tax payments, normally due on April 18, June 15 and Sept. 15. It also applies to the quarterly payroll and excise tax returns normally due on Jan. 31, April 30 and July 31.

[SFSTaxPrep]

On Thursday, California announced they were conforming to the IRS Extension until October 16.

[Ember123]

Dear Username is two words:

It seems to me, by the wording of the announcements that the filing and payment deadlines have been extended until October 15, that IRS would  not be charging interest  on individual income tax normally due April 15 , but not paid until October 15  pursuant to the disaster declarations.  Would you agree?

Jack

[Username is two words]

They sure did. Now we will have an even bigger bottleneck than usual for Oct. 16. 😞

[Username is two words]

Yes, I agree.Tbh the IRS website does not specifically say no interest, although it does say no penalties. But, if the due date is Oct. 16, that's the due date, payments are not late so there should be no interest. Hoping they address this later.  Notice they anticipate erroneous notices going out. At least they're honest about that.

WASHINGTON — Victims of severe winter storms, flooding, and mudslides in California beginning Jan. 8, 2023, now have until Oct. 16, 2023, to file various individual and business tax returns and make tax payments, the Internal Revenue Service announced today.

Following the disaster declaration issued by the Federal Emergency Management Agency, individuals and households affected by severe winter storms, flooding, and mudslides that reside or have a business in Alameda, Colusa, Contra Costa, El Dorado, Fresno, Glenn, Humboldt, Kings, Lake, Los Angeles, Madera, Marin, Mariposa, Mendocino, Merced, Mono, Monterey, Napa, Orange, Placer, Riverside, Sacramento, San Benito, San Bernardino, San Diego, San Francisco, San Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Solano, Sonoma, Stanislaus, Sutter, Tehama, Tulare, Ventura, Yolo, and Yuba counties qualify for 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 Jan. 8, 2023, and before Oct. 16, 2023, are granted additional time to file through Oct. 16, 2023. As a result, affected individuals and businesses will have until Oct. 16 to file returns and pay any taxes that were originally due during this period. This includes 2022 individual income tax returns due on April 18, as well as various 2022 business returns normally due on March 15 and April 18. Among other things, this means that eligible taxpayers will have until Oct. 16 to make 2022 contributions to their IRAs and health savings accounts.

In addition, farmers who choose to forgo making estimated tax payments and normally file their returns by March 1 will now have until Oct. 16, 2023 to file their 2022 return and pay any tax due. The Oct. 16, 2023, deadline also applies to the quarterly estimated tax payments, normally due on Jan. 17, 2023 and April 18, 2023. This means that individual taxpayers can skip making the fourth quarter estimated tax payment, normally due Jan. 17, 2023, and instead include it with the 2022 return they file, on or before Oct. 16.

The Oct. 16 deadline also applies to the quarterly payroll and excise tax returns normally due on Jan. 31, 2023. In addition, penalties on payroll and excise tax deposits due on or after Jan. 8, 2023, and before Jan. 23, 2023, will be abated as long as the tax deposits are made by Jan. 23, 2023.

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.

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.

[gk1]

Is Lacerte going to update the Client Letter so that it changes the dues dates to the postponed dates?

[abctax55]

@gk1 

Based on the 45 (or more) post thread that already exists on this issue/question ..... no.

[Ember123]

I think this is an accurate analysis.

[rarbob53]

California has conformed. The problem is that the Lacerte program does not accommodate the extended payment deadline. It still shows April 15, unless you file for an extension which is supposed to be automatic if you reside in one of 51 CA counties.