Update regarding tax returns for persons affected by disaster areas

Edited by Gerarde Moret, CPA, Pisenti & Brinker, LLP

Generally, the IRS has authority to extend the time for filing returns, paying taxes, and claiming refunds for persons
affected by a federally declared disaster, terrorist or military action, occurring on or after September 11, 2001.

A federally declared disaster is any disaster with regard to which the President determines that an area warrants
federal assistance under the Disaster Relief and Emergency Assistance Act, which the President declared applies
to California due to the several fires on October 10, 2017.

We expect the IRS will shortly publish guidance, which will describe the acts postponed and the length of
any extensions.

By way of example, victims of Hurricane’s Harvey, Irma and Maria with valid extensions falling within prescribed
periods have until January 31, 2018 to file any returns and pay any taxes due (however taxes that were due
previously, ie. individuals whose tax was due April 18, 2017 do not receive extensions of time to pay tax)

Previously, the IRS has issued final regulations that clarify the rules relating to the postponement of certain
tax-related deadlines because of a federally declared disaster. The regulations expands the definition of
“affected taxpayer” to include any individual or business entity whose necessary tax records are located in a
disaster area and any individual visiting the covered disaster area who was killed or injured as a result of the
disaster. “Affected taxpayers” who do not reside in the declared disaster areas will need to request waiver of
penalties as necessary, whereas taxpayers residing in a declared disaster area are automatically granted
extensions of time.

Accordingly, we expect that those of our clients whose tax returns are currently on extension, whether
you are personally within the disaster area or not, should receive extension of time to file your returns or
abatement of any penalties.

California declared several counties in California state disaster areas and also allows extensions of time to file
various tax returns. Please see this link for additional information: http://www.boe.ca.gov/info/state_of_emergency_tax_relief.htm

See also Extension of Deadlines for Disaster Victims PDF file.