[US] Victims of Kentucky storms and floods entitled to tax relief unti

12 Aug 2022

From August 2, Kentucky storm and flooding victims have been granted until November 15, 2022, to file for certain tax relief, according to the Internal Revenue Service (IRS), Investopedia reports.

Relief is available when filing certain individual and business tax returns and making tax payments, the agency says

The newly announced relief postpones certain tax filing and payment deadlines starting July 26, 2022. Now, affected individuals and businesses will have until November 15, 2022, to file returns and pay taxes originally due during this period.

Eligible Locations

Areas designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual or public assistance are eligible for tax relief.

At present, households and individuals in the following counties are eligible for relief:

Breathitt
Clay
Floyd
Johnson
Knott
Leslie
Letcher
Magoffin
Martin
Owsley
Perry
Pike
Wolfe

Areas added later will reportedly be eligible for the same relief with the same deadline. The IRS disaster relief page has the most up-to-date list.

Available Relief

The tax relief announced today postpones tax filing and payment deadlines that would have applied from July 26, 2022. Eligible taxpayers in designated areas have until November 15, 2022, to file and pay. This includes:

Individuals who had a valid extension to file their 2021 return due to run out on October 17, 2022.
Taxpayers who owe a quarterly estimated income tax payment due on September 15, 2022
Those with quarterly payroll and excise tax returns ordinarily due on August 1 and October 31.
Businesses with an original or extended due date including calendar-year partnerships and S corporations whose 2021 extensions run out on September 15, 2022, and calendar-year corporations whose 2021 extensions run out on October 17, 2022.

In addition, anyone owing a penalty on payroll and excise tax deposits due on or after July 26 and before August 10, will be abated as long as the deposits are made by August 10, 2022.

The Disaster Assistance and Emergency Relief for Individuals and Businesses page has details of other tax-related actions that qualify for an extension.

Although the filing deadline for those who requested an extension until October 17 on their 2021 return is now November 15, it should be noted that tax payments related to those returns are not eligible for this relief.

Relief Is Automatic for Most

The IRS will automatically provide relief to taxpayers with an IRS address inside the disaster area. These taxpayers do not need to contact the agency or file paperwork to obtain tax relief. Any taxpayer who receives a late filing or payment penalty notice they believe to be in error should call the number on the notice to have the penalty abated.

Taxpayers living outside the designated disaster areas but with records located in one of the designated areas should contact the agency at 866-562-5227 to ask for assistance. This includes workers involved in relief activities who are affiliated with a recognised government or philanthropic organisation.

Taxpayers With Disaster Losses

Individuals and businesses in a federally declared disaster area who experience uninsured or unreimbursed disaster-related losses can claim the loss:

on their tax return for the year the loss occurred (2022, filed in 2023); or
on their return for the prior year (2021) by filing an amendment to that return.

Taxpayers are advised to write the FEMA declaration number – DR-4663-KY − on any return claiming a loss. IRS Publication 547 provides additional details.

Summary

This just-announced tax relief is part of a coordinated federal response to the damage caused by recent storms in Kentucky and based on damage assessments by FEMA. The extension of time to file and, in some cases, pay until Nov. 15, 2022, considers the need for taxpayers and businesses to recover financially from this disaster.

Based on a taxpayer's listed IRS address, most extensions to file and pay are automatic. Taxpayers who receive what they believe to be an erroneous notice or penalty should contact the IRS for assistance. Disaster relief is an ongoing and evolving process. Further information on disaster recovery can be found at disasterassistance.gov.

Source: Investopedia

(Links via original reporting)