Contributed by: PhillipB, FreeTaxUSA Agent, Tax Pro
Going through disasters can be a harrowing experience. No one should have to deal with major property and personal losses while having to worry about filing a tax return and paying taxes. Fortunately, there are many tax relief provisions that are activated every time there is a disaster area declared by the president through FEMA.
The IRS recently announced the following tax relief items for people living in areas affected by the Los Angeles wildfires and straight-line winds:
- The filing and payment deadline for 2024 is extended to October 15th. If you owe for 2024, you do not need to pay your tax due by April 15th.
- Estimated tax payments for 2024, normally due on Jan. 15, and for 2025, normally due on April 15, June 16, and Sept. 15, will be postponed and are not due until October 15th.
- Taxpayers are eligible to claim personal casualty and theft losses using the FEMA disaster declaration number 4856-DR.
- Qualified disaster relief payments from government agencies are generally excluded from income. This includes funds that are used for reasonable and necessary personal, family, living or funeral expenses, along with repair, rehabilitation, or replacement expenses for the home and its contents.
- Affected taxpayers may take special disaster distributions from their retirement plans. These distributions are not subject to early withdrawal penalties for people that are under the age of 59.5, and the distribution income can be spread over three years.
- The filing and tax payment deadline has also been extended for the most common business and estate-related tax returns.
If you have any questions about how the disaster relief provisions apply to you and your tax situation, we are here to help answer those questions.
