The IRS has extended filing deadlines for several states, including Texas, as well as parts of Tennessee.
Extensions and other tax relief for Texans following the harsh winter storms experienced across the state last week. Millions found themselves without heat, running water, or access to supplies for days. Many now face ongoing challenges repairing plumbing and water damage from pipes that burst to tackling power bills that spiked as energy costs soared.
The Federal Emergency Management Agency (FEMA) declared the recent events as a disaster, and the IRS announced that victims of these devastating storms have until June 15, 2021 to file various individual and business tax returns and make certain tax payments.
What are the extended tax and payment deadlines?
The tax relief postpones various tax filing and payment deadlines that occurred starting on February 11. As a result, affected individuals and businesses will have until June 15, 2021, to file returns and pay any taxes that were originally due during this period. These include:
- 2020 Individual and Business Returns: 2020 individual tax returns and payments normally due on April 15, as well as various 2020 business returns along with payments due on March 15 have an extended deadline until June 15, 2021.
- 2020 IRA Contributions: Affected taxpayers will have until June 15, 2021 to make 2020 IRA contributions to make an impact on their 2020 taxes
- 2020 Quarterly Estimated Tax Payments: 2021 1st quarterly estimated tax deadline of April 15, 2021, is extended until June 15, 2021.
- Quarterly Payroll and Excise Tax Returns: Quarterly payroll and excise tax returns that are due April 30, 2021 are also extended until June 15, 2021.
Calendar-year tax-exempt organizations, operating on a calendar-year basis that have a 2020 tax return due May 17, also qualify for the extra time.
The IRS is providing this relief to the entire state of Texas. Taxpayers in other states impacted by these winter storms that receive similar FEMA disaster declarations will automatically receive the same filing and payment relief. The current list of eligible localities is available on the disaster relief page on IRS.gov.
What is needed to claim the tax extension?
The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. Taxpayers do not need 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.
Do surrounding areas outside of Texas qualify for an extension?
The IRS will 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 affected 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 can a casualty loss be claimed on taxes if a taxpayer was impacted?
Individuals or businesses who suffered uninsured or unreimbursed disaster-related casualty losses can choose to claim them on either the tax return for the year the loss occurred (in this instance, the 2021 return filed in 2022), or the loss can be deducted on the tax return for the prior year (2020). Be sure to write the FEMA declaration number – 4586 − on any return claiming a loss.
The tax relief is part of a coordinated federal response to the damage caused by the harsh winter storms and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.
Tax professionals can review an Intuit Accountants Community article on how to handle returns impacted by federally declared disaster zones, and check back with the Intuit® Tax Pro Center for more updates on disaster relief.
Relief for parts of Tennessee
Victims of this spring’s storms and tornadoes in Tennessee will have until Aug. 2, 2021, to file various individual and business tax returns and make tax payments.
Following the recent disaster declaration issued by FEMA, the IRS is providing this relief to taxpayers affected by storms, tornadoes, and flooding that took place between March 25, 2021, and April 3, 2021, in parts of Tennessee. Currently, relief is available to affected taxpayers who live or have a business in Campbell, Cannon, Cheatham, Claiborne, Clay, Davidson, Decatur, Fentress, Grainger, Hardeman, Henderson, Hickman, Jackson, Madison, Maury, McNairy, Moore, Overton, Scott, Smith, Wayne, Williamson and Wilson counties. The current list of eligible localities 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 March 25. As a result, affected individuals and businesses will have until Aug. 2 to file returns and pay any taxes that were originally due during this period. This includes 2020 individual income tax returns due on May 17, as well as various 2020 business returns normally due on April 15. Among other things, this also means that affected taxpayers will have until Aug. 2 to make 2020 IRA contributions.
The Aug. 2 deadline also applies to quarterly estimated income tax payments due on April 15 and June 15, and the quarterly payroll and excise tax returns normally due on April 30. It also applies to tax-exempt organizations, operating on a calendar-year basis, that have a 2020 return due on May 17.
In addition, penalties on payroll and excise tax deposits due on or after March 25 and before April 9 will be abated as long as the deposits were made by April 9.
Per guidance from IRS Chief Counsel, taxpayers residing in a federally declared disaster area qualifying for a disaster relief extension may paper file extensions using Form 4868, Application for Automatic Extension of Time to File U.S. Individual Tax Return, until June 15 to extend Form 1040 filings until October 15. Payment for these extensions may be made via the IRS Direct Pay website by June 15 or by check with Form 4868. Form 4868 extensions sent via e-file after May 17 will be rejected.
Editor’s note: This article was originally published Feb. 24, 2021, and updated with new content on May 18, 2021.