Don't Mess With Taxes

Next Monday, July 15, is Tax Day for residents of disaster areas in three states.

This tax deadline applies to taxpayers affected by Federal Emergency Management Agency (FEMA) major disaster declarations in parts of Alaska, Maine, and Rhode Island.

The disaster areas are listed below. The bold-type state names are links to the Internal Revenue Service's tax relief announcements for each area.

• The Wrangell Cooperative Association of Alaska Tribal Nation off coastal Alaska. That area was hit by severe storms, landslides, and mudslides that began on Nov. 20, 2023.
• Eight counties in Maine that sustained damages from severe storms and flooding that began on Jan. 9, 2024. The disaster area covers Cumberland, Hancock, Knox, Lincoln, Sagadahoc, Waldo, Washington, and York counties.
• Four counties in Rhode Island due to damages from severe storms and flooding that began on Dec. 17, 2023, and Jan. 9, 2024. The areas are in Kent, Newport, Providence, and Washington counties.

Affected filings: The July 15 deadline applies to the following returns and payments.

• Calendar-year 2023 partnership and S corporation returns, normally due on March 15.
• 2023 individual income tax returns and payments, normally due on April 15.
• Quarterly estimated tax payments, normally due on April 15 and June 17.
• Calendar-year 2023 corporate and fiduciary income tax returns and payments, normally due on April 15.
• Calendar-year 2023 returns filed by tax-exempt organizations, normally due on May 15.

The Internal Revenue Service says that other returns, payments, and time-sensitive tax-related actions also qualify for the extra time. For those details, check out the Disaster assistance and emergency relief for individuals and businesses page at IRS.gov.

More time possible: If you’re facing next Monday’s July 15 due date and won’t be able to meet it, you can get more time.

Send the IRS Do that by sending the IRS Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. This will get the disaster-area taxpayers until Oct. 15 to file their 2023 tax year returns.

However, there are a couple of things to note here.

First, you must fill out a paper Form 4858 and mail it to the IRS by July 15. Electronic filing options for requesting an extension are not available after the regular April 15 Tax Day.

Second, this three-month extension is, as always, only gives the affected taxpayers more time to file the required tax paperwork. Any tax owed must be paid by July 15 when you send in the Form 4868.

Claiming a disaster tax deduction: The Alaska, Maine, and Rhode Island filers looking at the July 15 deadline also may be able, as do taxpayers in all major disaster areas, to claim uninsured disaster losses as an itemized tax deduction.

They also get the option to choose the tax year in which to make the claim, either the tax year in which you sustain the loss, which is generally in the year the casualty occurred, or for the prior tax year.

Those wishing to claim any qualifying losses for 2023 can do so on the return due July 15, or due Oct. 15 if they get an extension. Or they can claim them on their 2024 tax year return they’ll file next year.

Filing a prior-year disaster claim could get you a tax refund now, providing money you can use toward storm recovery efforts. But run the numbers to see which filing year will get you more tax relief.

You can find more about potential disaster tax deductions, including the option to choose which tax year in which to make the claim (the year of the disaster or the prior tax year) in my post Considerations in making a major disaster tax claim.

One more July Tax Day: Finally, there is one more delayed Tax Day this month.

Two Massachusetts counties, Bristol and Worcester, were declared major disaster areas after severe storms and flooding there that began on Sept. 11, 2023. Individual and business taxpayers in those Bay State counties have until July 31 to file and pay a variety of taxes.

You also might find these items of interest:

• 5 July tax moves to make
• Resources to help deal with major natural disasters
• Hurricane season 2024 looks to be fulfilling its most-active forecast. Get ready now.

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