Taxpayers in certain areas affected by Hurricane Irene have until Oct. 31 to file certain returns and make payments normally due before then, the IRS announced Thursday (IR-2011-87). The areas eligible for relief include parts of North Carolina, New Jersey, New York and Puerto Rico; the IRS expects to provide similar relief to other places affected by the hurricane, such as Vermont, after more damage assessments and federal disaster area declarations by the Federal Emergency Management Agency. The areas the IRS identified on Thursday qualify as covered disaster areas for the purposes of Treas. Reg. § 301.7508A-1(d)(2).
Deadlines postponed until Oct. 31 include the Sept. 15 automatic extension filing date for 2010 tax returns of C corporations, S corporations and partnerships, as well as the Oct. 17 automatic extension filing date for individual taxpayers and electing large partnerships. The postponement also applies to the payment due date for the 2011 third-quarter installment of estimated tax of individuals and corporations, otherwise due Sept. 15. Under IRC § 7508A, the postponement applies generally to most tax returns and tax payments that have an original or extended due date between the relief beginning date and Oct. 31.
The beginning date depends on when the IRS says Irene affected each affected state or territory: Aug. 21 for Puerto Rico; Aug. 25 for North Carolina; Aug. 26 for New York; and Aug. 27 for New Jersey.
In addition, the IRS is waiving the failure-to-deposit penalties for employment and excise tax deposits due between those beginning dates and the following dates, as long as the deposits are made by the latter date: Sept. 6 for Puerto Rico; Sept. 9 for North Carolina; and Sept. 12 for New York and New Jersey.
Other relief to which the postponement applies includes time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Revenue Procedure 2007-56. These acts include filing various tax returns, paying certain taxes, making contributions to qualified retirement plans and filing refund claims. The relief does not include filing and making payments associated with information returns, including those in the W-2, 1099 and 1098 series or Forms 1042-S or 8027. However, failure-to-file penalties for those returns may be waived under existing procedures for reasonable cause.
The IRS also reminded taxpayers that under IRC § 165(i), if they have federally declared disaster-related casualty losses, they may claim a deduction either in the tax year the loss occurs or the immediately preceding one on an original or amended return.
The relief applies to individuals who reside in and businesses located in the following counties and municipalities:
- North Carolina: Beaufort, Carteret, Craven, Dare, Hyde, Pamlico and Tyrrell
- New Jersey: Bergen, Essex, Morris, Passaic and Somerset
- New York: Albany, Delaware, Dutchess, Essex, Greene, Schenectady, Schoharie and Ulster
- Puerto Rico: Caguas, Canóvanas, Carolina, Cayey, Loíza, Luquillo and San Juan
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Taxpayers within those areas should be identified by the IRS, which will apply the relief automatically. If, however, affected taxpayers receive a penalty notice in error, they may call the IRS at the number on the notice to obtain an abatement. In addition, the IRS advised that affected taxpayers who reside or have a business outside the covered area may request relief by calling the IRS disaster hotline at 1-866-562-5227.
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