IRS Announces Extension for New Jersey and New York Taxpayers affected by Hurricane Ida
The IRS recently announced that victims of Hurricane Ida in some parts of New Jersey and New York now have until January 3, 2022 to file various individual and business tax returns and to make tax payments.
The IRS is providing relief to any area designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual or public assistance. In New Jersey, this currently includes Bergen, Essex, Gloucester, Hudson, Hunterdon, Mercer, Middlesex, Passaic, Union and Somerset counties. In New York, it includes Bronx, Kings, Nassau, New York, Queens, Richmond and Westchester counties. Taxpayers in Ida-impacted areas subsequently designated by FEMA in other parts of these states will automatically receive the same filing and payment relief.
This relief postpones various tax filing and payment deadlines that occurred starting on September 1, 2021. Consequently, impacted individuals and businesses will have until January 3, 2022, to file returns and pay any taxes that were originally due during this period. For example, individuals who had a valid extension to file their 2020 return due to expire on October 15, 2021, will now have until January 3, 2022, to file. Note, however, that because tax payments related to these 2020 returns were due on May 17, 2021, those payments are not eligible for this relief.
The January 3, 2022 deadline also applies to quarterly estimated income tax payments due on September 15, 2021, and the quarterly payroll and excise tax returns normally due on November 1, 2021. Additionally, the relief applies to tax-exempt organizations, operating on a calendar-year basis, that had a valid extension due to expire on November 15, 2021. Businesses with an original or extended due date also have the additional time including, among others, calendar-year partnerships and S corporations whose 2020 extensions run out on September 15, 2021 and calendar-year corporations whose 2020 extensions run out on October 15, 2021.
In addition, penalties on payroll and excise tax deposits due on or after September 1 and before September 16, will be abated as long as the deposits are made by September 16, 2021.
Taxpayers with an IRS address of record located in the disaster area will automatically receive filing and penalty relief. Thus, taxpayers do not need to contact the agency to obtain this relief. Nevertheless, if an impacted taxpayer receives a late filing or late payment penalty notice from the IRS the taxpayer should call the number on the notice to have the penalty abated.
Furthermore, taxpayers who live outside the affected area but whose tax records are located in the disaster area may be eligible for the relief as well. Such taxpayers must contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.
Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2021 return, filed next year), or the return for the prior year (2020). IRS Publication 547 provides further details regarding such filings.
See the IRS disaster relief page for eligible localities and details on other returns, payments and tax-related actions qualifying for the additional time.
The State of New Jersey has also announced that it is offering similar relief for victims of Hurricane Ida for New Jersey returns. If the IRS further extends the filing deadline for federal tax purposes, the deadline for New Jersey returns and payments will also be extended.
Taxpayers who file a NJ return electronically (business or personal) should wait until they receive a notice from the NJ Division of Taxation. Taxpayers will need to respond to that notice requesting tax relief and indicating that the Taxpayer is in a Presidential Disaster Relief Area, Hurricane Ida. Taxpayers who file a paper return must write in black ink “Presidential Disaster Relief Area, Hurricane Ida”, on the top of the return or payment.
The State of New York has not issued a similar announcement regarding extensions to file NY tax returns as of this date.