The Internal Revenue Service (IRS) announced recently that individuals and businesses impacted by Hurricane Helene in parts of seven states will receive tax relief, including deadline extensions for filing and payments. This relief applies to the entire states of Alabama, Georgia, North Carolina, and South Carolina, as well as parts of Florida, Tennessee, and Virginia.
Taxpayers in these areas now have until May 1, 2025, to file various federal individual and business tax returns and make tax payments. This includes 2024 individual and business returns that are normally due in March and April of 2025, 2023 individual and corporate returns that are under valid extensions, and quarterly estimated tax payments.
The IRS is providing this relief to any area designated by the Federal Emergency Management Agency (FEMA). Currently, this includes all of Alabama, Georgia, North Carolina, and South Carolina, as well as 41 counties in Florida, eight counties in Tennessee, and six counties and one city in Virginia. The IRS noted that additional areas may be added as FEMA disaster declarations are made.
Key Relief Provisions
The tax relief postpones various filing and payment deadlines that began on:
- September 22, 2024, in Alabama
- September 23, 2024, in Florida
- September 24, 2024, in Georgia
- September 25, 2024, in North Carolina, South Carolina, and Virginia
- September 26, 2024, in Tennessee
As a result, affected individuals and businesses will have until May 1, 2025, to file returns and pay any taxes that were originally due during this period. This includes:
- 2024 returns due in March or April 2025 for individuals and businesses.
- 2023 federal returns under valid extensions (note: payments for these returns remain due as originally scheduled, as they were due before the hurricane).
- Quarterly estimated income tax payments due on January 15, 2025, and April 15, 2025.
- Quarterly payroll and excise tax returns due on October 31, 2024, January 31, 2025, and April 30, 2025.
Additionally, the IRS will provide penalty relief to businesses making payroll and excise tax deposits. The details of relief periods vary by state, and more information is available on the Around the Nation page of IRS.gov.
Automatic Relief and Additional Assistance
The IRS will automatically apply filing and penalty relief for taxpayers with an IRS address of record in the disaster area. These taxpayers do not need to contact the IRS to receive the relief.
For taxpayers who may have moved to the disaster area after filing their returns or who receive late filing or payment penalty notices, the IRS advises contacting the number on the notice to request penalty abatement.
The IRS is also offering assistance to taxpayers located outside the disaster area if their records necessary to meet deadlines are located in the affected area. These individuals should contact the IRS at 866-562-5227. Additionally, tax preparers with clients outside the disaster area may utilize the Bulk Requests from Practitioners for Disaster Relief option on IRS.gov.
Additional Tax Relief for Disaster Losses
Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed losses can choose to claim these losses on their 2024 return or on their 2023 return. Taxpayers have until October 15, 2025, to make this election. When claiming a disaster loss, taxpayers should include the FEMA declaration number on their return.
Qualified disaster relief payments are generally excluded from gross income. These payments, which cover necessary expenses for personal, family, living, or funeral costs, as well as home repairs, are not taxable. More details can be found in Publication 525, which addresses taxable and nontaxable income.
Taxpayers may also have access to additional relief if they participate in a retirement plan or an individual retirement arrangement (IRA). This may include the ability to take a special disaster distribution without facing the 10% early distribution tax, or to make a hardship withdrawal. Taxpayers should refer to their retirement plan for specific rules and guidance.
The IRS may announce further disaster-related relief measures in the future.
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