The IRS has announced new tax relief measures for individuals and businesses impacted by the wildfires and straight-line winds that began on January 7, 2025, in Southern California.

Affected taxpayers now have an extended deadline until October 15, 2025, to file various federal tax returns and make tax payments.

Who Qualifies for Relief?

This relief applies to areas identified by the Federal Emergency Management Agency (FEMA) as disaster zones. Currently, residents and businesses in Los Angeles County are eligible. Additional counties may be added to the disaster area as determined by FEMA. For the most up-to-date list of eligible locations, visit the IRS’s Tax Relief in Disaster Situations page.

Extended Deadlines

The extended deadline applies to several types of tax returns and payments originally due between January 7, 2025, and October 15, 2025. Key deadlines include:

• Individual Income Tax Returns: Normally due April 15, 2025.
• IRA and Health Savings Account Contributions for 2024: Extended for eligible taxpayers.
• Quarterly Estimated Income Tax Payments: Includes payments for January 15, April 15, June 16, and September 15, 2025.
• Quarterly Payroll and Excise Tax Returns: Typically due January 31, April 30, and July 31, 2025.
• Calendar-Year Partnership and S Corporation Returns: Previously due March 17, 2025.
• Calendar-Year Corporation and Fiduciary Returns: Previously due April 15, 2025.
• Tax-Exempt Organization Returns: Normally due May 15, 2025.

Additionally, penalties for failing to make payroll and excise tax deposits due between January 7, 2025, and January 22, 2025, will be waived, provided these deposits are made by January 22, 2025.

Automatic Relief Based on Address

The IRS automatically applies relief to taxpayers with an address of record within the disaster area. No action is needed to claim this benefit. However, if your address of record does not reflect your current location in the disaster area, you may receive a penalty notice. In this case, contact the IRS using the number listed on the notice to request penalty abatement.

For taxpayers outside the disaster area whose necessary records are located within the affected zones, or for relief workers assisting recovery efforts, additional support may be available. Contact the IRS Disaster Assistance hotline at (866) 562-5227 for guidance.

Retirement Plan Options

Additional provisions exist for those participating in retirement plans or IRAs. Eligible individuals may:

• Access special disaster distributions exempt from the 10% early withdrawal penalty, with the option to spread the income over three years.
• Qualify for hardship withdrawals, subject to the rules of their specific plan or IRA.

We Can Help

The IRS may expand relief measures as the situation develops. If you have questions about disaster tax relief or claiming casualty loss deductions, reach out to your Wegner CPAs tax advisor for assistance. We’re here to support you through this challenging time.