• 2016 Flood Tax Relief Update
  • August 24, 2016 | Author: Lance J. Kinchen
  • Law Firm: Breazeale, Sachse & Wilson, L.L.P. - Baton Rouge Office
  • LA-2016-20 provides that victims of the severe flooding that took place beginning on August 11, 2016 who reside or have a business in the disaster area now have until January 17, 2017 to file most tax returns, pay any taxes or make any deposits that were due on or after August 11, 2016. The IRS has announced that taxpayers in the parishes of East Baton Rouge, Livingston, St. Helena and Tangipahoa will receive such tax relief. However, that list may expand as additional flooding occurs.

    Tax relief applies to any return, tax payment or tax deposit with an original or extended due date that fell on or after August 11, 2016. The IRS will abate interest and any late filing, late payment or failure to deposit penalties that would otherwise apply. This relief includes the September 15th due date for quarterly estimated taxes, the September 15th due date for calendar-year corporate and partnership tax returns with automatic extensions; the October 17th due date for individuals who received an extension for filing their individual income tax returns; and the October 31st deadline for filing quarterly federal employment and excise tax returns. In addition, the IRS is waiving the failure-to-deposit penalties for employment and excise deposits due on or after August 11 as long as the deposits were made by August 26, 2016.

    The IRS will automatically grant this relief to any individual or business located in the disaster area. Any disaster area taxpayer who receives a penalty notice from the IRS should call the toll-free number on the notice to receive penalty abatement. In addition, the IRS will work with any taxpayer who resides elsewhere but whose books, records or tax professional are located in the relief area.

    In addition, 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.