DISASTER WRAP-UP 2020
In addition to the Coronavirus being declared an emergency in all states, in order to qualify for federal aid, there were various other natural disasters for which additional tax relief is due to those affected in the counties and states noted.
Who gets relief. Only taxpayers considered to be affected taxpayers are eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts. Affected taxpayers are those listed in Reg § 301.7508A-1(d)(1) and thus include:
- any individual whose principal residence, and any business entity whose principal place of business, is located in the counties designated as disaster areas;
- any individual who is a relief worker assisting in a covered disaster area, regardless of whether he is affiliated with recognized government or philanthropic organizations;
- any individual whose principal residence, and any business entity whose principal place of business, is not located in a covered disaster area, but whose records necessary to meet a filing or payment deadline are maintained in a covered disaster area;
- any estate or trust that has tax records necessary to meet a filing or payment deadline in a covered disaster area; and
- any spouse of an affected taxpayer, solely with regard to a joint return of the husband and wife.
What may be postponed. Under Code Sec. 7508A , IRS gives affected taxpayers until the extended date (specified by county, below) to file most tax returns (including individual, estate, trust, partnership, C corporation, and S corporation income tax returns; estate, gift, and generation-skipping transfer tax returns; and employment and certain excise tax returns), or to make tax payments, including estimated tax payments, that have either an original or extended due date falling on or after the onset date of the disaster (specified by county, below), and on or before the extended date. IRS also gives affected taxpayers until the extended date to perform other time-sensitive actions described in Reg § 301.7508A-1(c)(1) and Rev Proc 2007-56, 2007-34 IRB 388 , that are due to be performed on or after the onset date of the disaster, and on or before the extended date. This relief also includes the filing of Form 5500 series returns, in the way described in Rev Proc 2007-56, Sec. 8 . Additionally, the relief described in Rev Proc 2007-56, Sec. 17 , relating to like-kind exchanges of property, also applies to certain taxpayers who are not otherwise affected taxpayers and may include acts required to be performed before or after the period above.
The postponement of time to file and pay does not apply to information returns in the W-2, 1098, 1099 or 5498 series, or to Forms 1042-S or 8027. Penalties for failure to timely file information returns can be waived under existing procedures for reasonable cause. Likewise, the postponement does not apply to employment and excise tax deposits. IRS, however, will abate penalties for failure to make timely employment and excise deposits, due on or after the onset date of the disaster, and on or before the deposit delayed date (specified by county, below), provided the taxpayer made these deposits by the deposit delayed date.
Affected areas and dates for storms, floods and other disasters occurring in 2020 that are federal disaster areas qualifying for individual assistance, as published on IRS's website, are listed below.
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