The IRS announced disaster relief that extends federal tax deadlines for taxpayers in certain California counties to May 15, 2023. This relief is in response to the severe winter storms, flooding and mudslides experienced in the affected counties and Federal Emergency Management Agency’s (FEMA’s) resulting disaster area declaration.
Who is eligible for the federal tax deadline relief
The covered disaster area includes the following counties:
Alameda, Colusa, Contra Costa, El Dorado, Fresno, Glenn, Humboldt, Kings, Lake, Los Angeles, Madera, Marin, Mariposa, Mendocino, Merced, Mono, Monterey, Napa, Orange, Placer, Riverside, Sacramento, San Benito, San Bernardino, San Diego, San Francisco, San Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Solano, Sonoma, Stanislaus, Sutter, Tehama, Tulare, Ventura, Yolo and Yuba counties.
The federal tax relief applies to:
Affected individuals and businesses will have until May 15, 2023, to file returns and pay any taxes that were originally due. That also applies to taxpayers not in the covered disaster area, but whose records necessary to meet a deadline are in the covered disaster area. The May 15, 2023, deadline also applies to the quarterly estimated tax payments normally due Jan. 17, 2023, and April 18, 2023, as well as quarterly payroll and excise tax returns normally due Jan. 31, 2023.
In addition, penalties on payroll and excise tax deposits due on or after Jan. 8, 2023, and before Jan. 23, 2023, will be abated as long as the tax deposits are made by Jan. 23, 2023.
The relief does not extend to information returns in the W-2, 1094, 1095, 1097, 1098 or 1099 series, Forms 1042-S, 3921, 3922 or 8027, or to employment and excise tax deposits, with few exceptions. However, penalties on deposits due on or after Jan. 8, 2023, and before Jan. 23, 2023, will be abated if the tax deposits are made by Jan. 23, 2023.
Affected taxpayers with casualty losses attributable to the federally declared disaster may elect to take losses into account either in the tax year the loss occurred or the prior tax year.
California state tax deadline relief
On Jan. 13, 2023, California announced conformity with the IRS-provided relief. California’s Franchise Tax Board has extended the filing and payment deadlines for individuals and businesses in California until May 15, 2023.
This relief applies to deadlines falling on or after January 8, 2023, and before May 15, 2023, including the 2022 individual income tax returns due on April 18 and the quarterly estimated tax payments typically due on January 17, 2023, and April 18, 2023.
California also previously issued two additional relief declarations:
Please reach out to your Baker Tilly advisor if you have questions regarding how the federal and California tax deadline relief affect you.
The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.