On September 4, 2020, wildfires ravaged areas of California. The president has declared Fresno, Los Angeles, Madera, San Bernardino, San Diego, and Siskiyou as federal disaster areas in California. Thus, granting taxpayers who live or have a business in the disaster area possible tax relief.
California Filing Deadlines Extended
The IRS extended tax deadlines that fall between September 4, 2020 and January 15, 2021, are extended to January 15, 2021 for taxpayers in the disaster zone. The extension includes applies to the following returns:
individual;
corporate;
estate and trust income tax returns;
partnership;
S corporation income tax returns;
estate, gift, and generation-skipping transfer tax returns;
the Form 5500 series returns; and
employment and certain excise tax returns.
However, the extension does not include information returns such as: Form W-2, Form 1098, Forms 1099, Forms 1042-S, or Form 8027.
California Payment Deadlines Extended
If your estimated tax payments are due between September 4, 2020 and January 15, 2021, the relief includes extra time to make tax payments. Additionally, the IRS will excuse late penalties for employment and excise tax deposits due between September 4 and and September 21, 2020 so long as the taxpayer makes the deposits by September 21, 2020.
Casualty Losses
Disaster-related casualty losses are available for affected taxpayers to claim on their 2019 or 2020 federal income tax return. Taxpayers may want to consider deducting personal property losses not covered by insurance or other reimbursements. Those claiming a disaster loss on their 2019 or 2020 return will need to write "California Wildfires" at the top of the return. This will allow the IRS to prioritize processing the refund.
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