Don't Mess With Taxes

A few years ago, tugboats pushing barges down the Mississippi River, like this one going under the Vicksburg Bridge, was not a problem. Extreme drought, however, has lowered the river's levels, allowing salty water from the Gulf of Mexico to creep upstream below a layer of freshwater. (Photo by Justin Wilkens on Unsplash)

Salt water is creeping up the mouth of the Mississippi River and threatening the drinking supply of several parishes in Southeast Louisiana, including the city and suburbs of New Orleans.

The prospects are so severe, the Federal Emergency Management Agency (FEMA) declared major disasters in Jefferson, Orleans, Plaquemines, and St. Bernard parishes. The Internal Revenue Service followed with an announcement of tax relief for individuals and businesses in those locations.

Lots of Feb. 15, 2024, deadlines: These taxpayers now have until Feb. 15, 2024, to file various federal individual and business tax returns and make tax payments.

Affected Louisianans now join taxpayers in six other states who now have until next February to take care of some tax tasks. In addition to Pelican State residents dealing with the saltwater intrusion disaster, the Feb. 15, 2024, deadline applies to —

• Maine and Massachusetts taxpayers who were affected by Hurricane Lee;
• Florida, Georgia, and South Carolina taxpayers who were struck by Hurricane Idalia; and
• Hawai'i's Big Island and Maui taxpayers whose homes and businesses were destroyed or damaged by wildfires.

This collection of disasters and subsequent postponed tax deadline of Feb. 15, 2024, earns the date designation as this weekend's By the Numbers figure.

Many locales, same general relief: The Louisiana disaster tax relief follows the same general paraments as the earlier mid-February tax payment and filing due date extensions.

The new Feb. 15, 2024, deadline is for taxpayers who got the usual extension (by filing IRS Form 4868) earlier this year to file by Oct. 16, 2023.

Remember, though, that when the extension request was made, either on or before April 18, taxpayers should have paid any tax due. If they didn't, penalty and interest charges have been accruing. The disaster announcement does not change this.

In addition, the newly-added Louisiana taxpayers who pay estimated taxes now get more time to submit their final tax year 2023 installment, normally due on Jan. 16, 2024. That's pushed to Feb. 15, 2024.

Calendar-year corporations whose 2022 extensions run out on Oct. 16 also qualify for the Feb. 15, 2024, filing postponement deadline. Penalties on payroll and excise tax deposits due on or after Sept. 20, 2023, and before Oct. 5, 2023, will be abated as long as the tax deposits are made by Oct. 5, 2023.

Claiming a disaster tax deduction: Finally, for what seems like the gazillionth time this year, the IRS (and the ol' blog) remind disaster area taxpayers that they may be able to claim any uninsured losses as a tax deduction.

You also get to decide on the tax year you use to make the claims.

You can find more about disaster claim filings in my post Considerations in making a major disaster tax claim. The IRS has more about this claim filing option in Publication 547, as well as on the agency's Disaster Assistance and Emergency Relief for Individuals and Businesses online page.

Whenever you file any tax document that's in connection with a major disaster, you should put the assigned FEMA declaration number on the documents. This will alert the IRS to give it expedited attention.

For Louisiana saltwater intrusion filings, that's FEMA declaration EM-3600-LA.

If FEMA adds more parishes to this disaster area, individuals and businesses in those areas will get the same tax relief. You can keep up with any disaster and tax updates here at the ol' blog, by staying in touch with your tax advisor, and/or periodically checking FEMA's online declarations and IRS.gov's special tax relief in disaster situations page.

Finally, you can get more on the Mississippi's saltwater troubles in these articles from The Hill and FoxWeather.

You also might find these disaster tax items of interest:

• Picking up the pieces after a major disaster
• Document your property for tax, insurance claims before storms hit
• Storm Warnings: Preparing for, recovering from, and helping those affected by natural disasters

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