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 that occurred beginning December 27, 2022, the IRS is granting filing and payment extensions until October 16, 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
- Estate and trust income tax returns,
- Gift and generation-skipping transfer tax returns
- 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 October 16, 2023 for the following:
- Individual income tax returns and payments due on April 18, 2023,
- Quarterly estimated tax due January 17, 2023, March 15,2023, April 18, 2023, June 15, 2023, and September 15, 2023 and
- Business entities whose tax returns and payments are due on March 15, 2023 and April 18, 2023
- Pass-through entity (PTE) elective tax payments due on March 15, 2023 and June 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 affected taxpayers in the following disaster areas: Alameda, Butte, Calaveras, Colusa, Contra Costa, El Dorado, Fresno, Glenn, Humboldt, Imperial*, Kern*, Kings, Lake, Los Angeles, Madera, Marin, Mariposa, Mendocino, Merced, Modoc**, Mono, Monterey, Napa, Orange, Placer, Plumas*, Riverside, Sacramento, San Benito, San Bernardino, San Diego, San Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, San Francisco, Shasta**, Sierra*, Siskiyou, Solano, Sonoma, Stanislaus, Sutter, Tehama, Tulare, Trinity, Ventura, Yolo and Yuba counties. If you are outside of the disaster area but were affected, please contact the IRS at 866-562-5227.
*Please note that taxpayers in Imperial, Kern, Plumas, and Sierra counties the relief only applies to deadlines on or after March 9, 2023.
**Further note that for taxpayers in Modoc and Shasta Counties, filing and payment deadlines that fall between February 21, 2023 and August 15, 2023 are only postponed until August 15, 2023, not October 16, 2023.
The extended deadline still does not include taxpayers residing in Lassen County.
There are additional payroll deposit relief for taxpayers. Penalties on payroll and excise tax deposits due on or after February 21, 2023 and before March 8, 2023 will be abated as long as the tax deposits were made by March 8, 2023.
- Alameda; Colusa; Contra Costa; Lassen; Marin; Modoc; Riverside; San Diego; Shasta; Siskiyou; Solano; Sutter; Tehama; Ventura; and Yolo.
Affected taxpayers include individuals who live in the above disaster areas as well as businesses and tax-exempt organizations whose principal place of business is located in the covered disaster area. It further includes taxpayers who are not in the covered disaster area but whose records are physically located in the covered disaster area.
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. In addition, the CA FTB has posted disaster relief FAQs regarding the available extensions.
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.