Deadline to File, Pay Taxes After Natural Disaster? There’s Uncertainty

When a natural disaster hits, you’ll be focused on ensuring your people and property are safe. Details like tax deadlines may not be top of mind.

So, if there’s any uncertainty about how much time you have to make deposits and submit reports, that’s going to make recovery efforts more challenging.

In a new report, the Treasury Inspector General for Tax Administration (TIGTA) asked the IRS to provide clearer communication about tax filing and payment deadlines following natural disasters.

After any federally declared disaster, the IRS can grant automatic tax relief under IRC Sec. 7508A. Its website conveys how much extra time taxpayers have to file returns and make payments – that’s clear. But subsequent mailings can cause confusion.

Say a company files Form 941 and has a balance due. The IRS is required by IRC Sec. 6303(a) to send a notice of the amount due. It’s called CP161, Statutory Notice of Underpayment. The notice also includes the payment due date. Problem is, the CP161 lists the typical due date, not the postponed due date.

The accompanying “stuffer” – Notice 1462, Important! You Have More Time to File and Pay Your Taxes Due to a Disaster – doesn’t contain the new deadline details, either.

Changes to Notice

So, in its report, TIGTA said the IRS should plainly inform businesses that they: 1) are located in a federally declared disaster area, 2) have been granted tax relief and 3) don’t need to pay the balance due until the end of the postponement period. Specifically, TIGTA recommended that the IRS:

• create a cover sheet to be included with the CP161, and/or
• revise the CP161 notice.

In response to the TIGTA report, the IRS agreed to work on improvements to the notice.

That’s good news for businesses that want to be prepared to respond after a natural disaster.

The IRS has already turned its attention to the comparable notice it sends to individual taxpayers – i.e., CP14, Statutory Notice of Underpayment.

In May 2024, it began mailing a cover sheet, the CP14C, along with that notice, indicating the postponed deadline. Plus, the IRS is exploring the development of a new notice, the CP14D. But that wouldn’t be ready to send out until 2025 at the earliest.

Recently Granted Tax Relief

Here are the most recent state-based announcements from the IRS website, regarding where tax relief has been granted following a storm or other natural disaster:

• New Mexico, Chaves County: Severe storms and flooding began on October 19, 2024. Businesses there have until May 1, 2025, to file 941s normally due on October 31, 2024, January 31, 2025, and April 30, 2025. The IRS released the information in NM-2024-07.
• South Dakota, Cheyenne River Sioux Tribe: Severe storms, straight-line winds and flooding began on July 13, 2024. Businesses there have until February 3, 2025, to file 941s normally due on July 31, 2024, October 31, 2024, and January 31, 2025. The IRS released the information in SD-2024-14.
• New York, Saint Regis Mohawk Tribe: Severe storms and flooding began on August 8, 2024. Businesses there have until February 3, 2025, to file 941s normally due on October 31, 2024, and January 31, 2025. The IRS released the information in NY-2024-13.
• Arizona, Havasupai Tribe: Flooding began on August 22, 2024. Businesses there have until February 3, 2025, to file 941s normally due on October 31, 2024, and January 31, 2025. The IRS released the information in AZ-2024-09.
• Alaska, City and Borough of Juneau: Flooding began on August 5, 2024. Businesses there have until May 1, 2025, to file 941s normally due on October 31, 2024, January 31, 2025, and April 30, 2025. The IRS released the information in AK-2024-08.