Tax relief for people and businesses affected by hurricanes and wildfires

Natural disasters have become as much a part of August and September as barbecues and back to school. Hurricanes in the Southeast and wildfires in the West regularly drive millions of people from their homes and businesses, as they have this year in California, Colorado, Louisiana, Oregon, Texas, Washington, and elsewhere. Tax relief can’t replace all that’s lost, but it can ease the tax burden for affected businesses and individuals.

In California, Louisiana, and Texas, taxpayers affected by severe weather or fires may be eligible for an extension to file and pay taxes due. Read on for more details. 

Governor Gavin Newsom declared a statewide state of emergency on August 18, 2020, and additional states of emergency for Fresno, Madera, Mariposa, San Bernardino, and San Diego counties on September 6, 2020. Taxpayers directly affected by these declared disasters may be eligible for tax return extensions, relief from penalties, interest, or fees for replacement copies of records lost or destroyed during a disaster.

Qualifying taxpayers in declared counties who cannot meet their filing and payment deadlines may be granted an extension of up to three months. Relief isn’t automatic: Taxpayers must submit a relief request online or on paper.

Louisiana taxpayers located in federally declared disaster areas may be eligible for an automatic extension to file and pay taxes. Louisiana Department of Revenue Secretary Kimberly Lewis Robinson explains, “Hurricane Laura brought devastation to many families and businesses across our state, and taxes are the last thing on their minds. With these automatic tax extensions in place, those families and businesses can focus on the rebuilding process.”

Qualifying taxpayers have until November 30, 2020, to file returns and submit payments for sales and use tax, severance and excise tax, and withholding tax returns and payments due between August 24 and November 2, 2020. The extended due date for corporate income and franchise tax, individual income tax, fiduciary income tax, partnership tax, and partnership composite tax returns and payments due between August 24 and November 2, 2020, is December 31, 2020.

Taxpayers must be in good standing to qualify for the relief. According to the Louisiana Department of Revenue (LDR), “If penalties or interest began accruing on the return or tax before Aug. 24, 2020, the taxpayer will not be eligible for this relief.”

As of September 8, 2020, declared disaster areas include Acadia, Allen, Beauregard, Calcasieu, Cameron, Grant, Jackson, Jefferson Davis, Lincoln, Natchitotches, Ouachita, Rapides, Sabine, Vermillion, Vernon, and Winn parishes. LDR may add to that list if more parishes are declared federal disaster areas.

Taxpayers with a business or residence in counties hit hard by Hurricane Hanna or Hurricane Laura may be eligible for tax relief. To secure it, they must apply for an extension from the Texas Comptroller. Extensions will be granted in 30-day increments, and taxpayers may request up to three extensions (for a total of 90 days).

Governor Greg Abbott has issued disaster proclamations for the following counties: Anderson, Angelina, Aransas, Bee, Bexar, Bowie, Brazoria, Brooks, Calhoun, Cameron, Camp, Cass, Chambers, Cherokee, Dallas, Dimmit, Duval, Ellis, Fort Bend, Franklin, Galveston, Goliad, Gregg, Grimes, Hardin, Harris, Harrison, Hidalgo, Houston, Jackson, Jasper, Jefferson, Jim Hogg, Jim Wells, Kenedy, Kleberg, La Salle, Liberty, Leon, Live Oak, Madison, Marion, Matagorda, McMullen, Montgomery, Morris, Nacogdoches, Newton, Nueces, Orange, Panola, Polk, Red River, Refugio, Rusk, Sabine, San Augustine, San Jacinto, San Patricio, Shelby, Smith, Starr, Tarrant, Titus, Travis, Trinity, Tyler, Upshur, Victoria, Walker, Waller, Webb, Wharton, Willacy, Wood, and Zapata (see Disaster Declarations for Hurricane Hanna and Hurricane Laura).

Taxpayers in need of an extension must provide the following information to ExtensionRequests@cpa.texas.gov:

• Taxpayer name
• Taxpayer number
• Tax type(s) for the extension requested
• Affected filing period(s)
• Name and phone number of the individual making the request

Tax officials in Colorado, Oregon, Washington, and other affected states have announced no disaster-related tax relief as of this writing, though that could change at any moment. Check the following websites for the most up-to-date information:

• Colorado Department of Revenue
• Oregon Department of Revenue
• Washington Department of Revenue

Moving sales tax compliance to the cloud can help ease tax compliance worries at all times. 

Stay safe.