Following the recent disaster declaration issued by the Federal Emergency Management Agency, the IRS announced that affected taxpayers in certain areas will receive tax relief. 

Tennessee – Individuals and households affected by severe storms, straight-line winds, tornadoes, and flooding that reside or have a business in Campbell, Cannon, Cheatham, Claiborne, Clay, Davidson, Decatur, Fentress, Grainger, Hardeman, Henderson, Hickman, Jackson, Madison, Maury, McNairy, Moore, Overton, Scott, Smith, Wayne, Williamson, and Wilson counties qualify for tax relief. The declaration permits the IRS to postpone certain tax-filing and tax-payment deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after March 25, 2021, and before August 2, 2021 are postponed through August 2, 2021.

Alabama – Individuals and households affected by severe storms, straight-line winds, and tornadoes that reside or have a business in Bibb, Calhoun, Clay, Hale, Jefferson, Perry, Randolph, and Shelby counties qualify for tax relief. The declaration permits the IRS to postpone certain tax-filing and tax-payment deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after March 25, 2021, and before August 2, 2021 are postponed through August 2, 2021. This includes the May 17 deadline for filing 2020 individual income tax returns and paying any tax due. Taxpayers also have until August 2 to make 2020 IRA contributions.

The August 2, 2021 deadline applies to the first quarter estimated tax payment, normally due on April 15, and the second quarter payment normally due on June 15. It also applies to the quarterly payroll and excise tax returns normally due on April 30, 2021. If an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date that falls within the postponement period, the taxpayer should call the telephone number on the notice to have the IRS abate the penalty.

Kentucky – Individuals and households affected by severe storms, flooding, landslides and mudslides that reside or have a business in Bell, Boyd, Breathitt, Calloway, Carter, Casey, Clark, Clay, Cumberland, Edmonson, Elliott, Estill, Floyd, Franklin, Graves, Harlan, Jackson, Johnson, Knott, Knox, Lawrence, Lee, Leslie, Letcher, Lincoln, Magoffin, Marion, Martin, Mason, Menifee, Morgan, Ohio, Owsley, Perry, Pike, Powell, Pulaski, Rockcastle, Union, Whitley, and Wolfe counties qualify for tax relief. The declaration permits the IRS to postpone certain tax-filing and tax-payment deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after February 27, 2021, and before June 30, 2021 are postponed through June 30, 2021. This includes the May 17 deadline for filing 2020 individual income tax returns and paying any tax due. Taxpayers also have until June 30 to make 2020 IRA contributions.

Louisiana – Following the recent disaster declaration issued by the Federal Emergency Management Agency, the IRS announced that affected taxpayers in all 64 parishes will receive tax relief. This includes Individuals and households affected by Severe Winter Storms that reside or have a business in any of these parishes. The declaration permits the IRS to postpone certain tax-filing and tax-payment deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after February 11, 2021, and before June 15, 2021 are postponed through June 15, 2021. This includes 2020 business returns, normally due on March 15 and individual and business returns normally due on April 15. It also includes the special March 1 filing and payment deadline for farmers and fishers who forgo making estimated tax payments. Taxpayers also have until June 15 to make 2020 IRA contributions.

Oklahoma – Following the recent disaster declaration issued by the Federal Emergency Management Agency, the IRS announced that affected taxpayers in all 77 counties will receive tax relief. This includes Individuals and households affected by Severe Winter Storms that reside or have a business in any of these counties. The declaration permits the IRS to postpone certain tax-filing and tax-payment deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after Feb. 8, 2021, and before June 15, 2021 are postponed through June 15, 2021. This includes 2020 business returns, normally due on March 15 and individual and business returns normally due on April 15. It also includes the special March 1 filing and payment deadline for farmers and fishermen who forgo making estimated tax payments. Taxpayers also have until June 15 to make 2020 IRA contributions.

Texas – The tax relief postpones various tax filing and payment deadlines to the entire state of Texas that occurred starting on February 11. As a result, affected individuals and businesses will have until June 15, 2021, to file returns and pay any taxes that were originally due during this period. This includes 2020 individual and business returns normally due on April 15, as well as various 2020 business returns due on March 15. Among other things, this also means that affected taxpayers will have until June 15 to make 2020 IRA contributions.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts are those taxpayers listed in Treas. Taxpayers not in the covered disaster area, but whose records necessary to meet a deadline and are in the covered disaster area, are also entitled to relief. In addition, all relief workers affiliated with a recognized government or philanthropic organization assisting in the relief activities in the covered disaster area and any individual visiting the covered disaster area who was killed or injured as a result of the disaster are entitled to relief.

The IRS gives affected taxpayers an extension of time to file most tax returns, Affected taxpayers that have an estimated income tax payment originally due on the due dates will not be subject to penalties for failure to pay estimated tax installments as long as such payments are paid on or before the extended deadlines. The IRS also gives affected taxpayers an extension of time to perform other time-sensitive actions, 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.

Casualty Losses

Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either the year in which the event occurred, or the prior year. Affected taxpayers claiming the disaster loss on a 2020 return should put the Disaster Designation, in bold letters at the top of the form.

For more information refer to : https://www.irs.gov/newsroom/tax-relief-in-disaster-situations