After three years of drought, California has experienced an onslaught of storms within a short span of three weeks beginning January 8, 2023. As such, the grounds are saturated. Streets are heavily flooding and destroying homes and businesses. Sinkholes are forming and trees are collapsing.

To provide relief to California storm victims, the IRS is granting filing and payment extensions that occurred beginning January 8, 2023 until May 15, 2023. This deadline applies to the following:

  • Individual income tax returns,
  • Business return filings normally due between March 15 and April 18, 2023,
  • 2022 Fourth and 2023 first quarter estimated tax payments due on January 17, 2023 and April 18, 2023. The fourth quarter estimated tax payment may be skipped and included with the 2022 return if it is filed on or before May 15, 2023
  • IRA and HSA contributions, and
  • Quarterly payroll and excise tax returns normally due on January 31, 2023 and April 30, 2023.

The IRS excused late penalties for employment and excise tax deposits due between January 8, 2023 and January 23, 2023 as long as the taxpayer makes the deposits by November 22, 2023.

Please note that this extension does not apply to information returns: Form W-2, 1094, 1095, 1097, 1098, 1099 series, 1042-S, 3921, 3922, or 8027.

Additionally, the California Franchise Tax Board has also conformed to the IRS filing and payment extensions until May 15, 2023 for the following:

  • Individual income tax returns and payments due on April 18, 2023,
  • Quarterly estimated tax payments due January 17, 2023 and April 18, 2023, and
  • Business entities whose tax returns and payments are due on March 15, 2023

Should you need copies of previously filed returns lost in the disaster, they may be requested through Form FTB 3516.

FTB will also suspend mailing collection notices to affected taxpayers for the next 30 days, beginning January 13, 2023.

This is an automatic relief for taxpayers in the following disaster areas: 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 Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, San Francisco, Solano, Sonoma, Stanislaus, Sutter, Tehama, Tulare, Ventura, Yolo and Yuba counties. If you are outside of the disaster area but were affected, please contact the IRS at 866-562-5227.

Victims in these areas may also claim their uninsured or unreimbursed disaster-related losses in the year the loss occurred (2023) or on the return of the prior year (2022) with the appropriate FEMA declaration number “3691-EM”. For more information on disaster recovery, please view IRS Publication 547 and  disasterassistance.gov.

 

Dana R. Borys, an Accountancy Corporation is a boutique tax consulting, compliance, and representation firm working with start-up/emerging growth companies and affluent individuals. Building connections beyond the code.