South Carolina flood victims, including individuals and businesses that previously received a tax-filing extension to October 15, will have until February 16, 2016, to file their returns and pay any taxes due, the IRS announced. All workers assisting in the relief activities, who are affiliated with a recognized government or philanthropic organization, also qualify for relief.
On October 5, President Obama declared many counties in South Carolina to be disaster areas. Following the disaster declaration for individual assistance issued by the Federal Emergency Management Agency, the IRS stated that affected taxpayers in Berkeley, Charleston, Clarendon, Dorchester, Georgetown, Horry, Lexington, Orangeburg, Richland, Sumter and Williamsburg Counties will receive this and other special tax relief. Other locations were subsequently added, based on damage assessments by FEMA, including Calhoun, Darlington, Florence, Kershaw and Lee counties.
The tax relief postpones various tax filing and payment deadlines that occurred starting on October 1, 2015. As a result, affected individuals and businesses will have until February 16, 2016, to file these returns and pay any taxes due. Besides the October 15 extension deadline, this also includes the January 15, 2016, deadline for making quarterly estimated tax payments. A variety of business tax deadlines are also affected including the November 2, 2015, and February 1, 2016, deadlines for quarterly payroll and excise tax returns.
The IRS will abate any interest, late-payment or late-filing penalty that would otherwise apply. The agency automatically provides this relief to any taxpayer with an IRS address of record located in the disaster area. Taxpayers don’t need to contact the IRS to get this relief.
Beyond Designated Disaster Areas
The IRS will work with any taxpayer who lives outside the disaster area but whose records needed to meet a deadline occurring during the postponement period are located in the affected area. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227.
Individuals and businesses who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either last year’s or this year’s return. Claiming these casualty loss deductions on either an original or amended 2014 return will get the taxpayer an earlier refund but waiting to claim them on a 2015 return could result in greater tax savings depending upon other income factors.
In addition, the IRS is waiving late-deposit penalties for federal payroll and excise tax deposits normally due on or after October 1 and before October 16 if the deposits are made by October 16, 2015. Details on available relief can be found on the disaster relief page on IRS.gov.
The tax relief is part of a coordinated federal response to the damage caused by severe storms and flooding and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.
For more information about your situation, contact your tax adviser.