In response to the severe storms, straight-line winds, tornadoes, and flooding that recently swept across Texas, the IRS has provided tax relief to affected individuals and businesses, including extended payment deadlines. Please note that this relief applies to all taxpayers who reside in or have a business in the covered disaster area, AND it includes taxpayers whose tax records are located within the covered disaster area. Since MGA is located within the covered disaster area, this disaster relief will apply to all MGA clients.
Here, we detail what these changes mean for you, including new due dates for tax payments and how you can benefit from these adjustments.
This year, quarterly tax payments are due on June 17 for Q2 and September 16 for Q3. However, due to the recent severe weather events in Texas, these deadlines have been adjusted. Both Q2 and Q3 tax payments are now due by November 1, 2024. In fact, all federal tax payments due between April 25 and October 31 are extended until November 1. This extension provides some breathing room for those who are navigating the aftermath of these disasters.
To simplify this process, we will not be sending out the usual Q2 and Q3 payment vouchers in June and September. Instead, we will provide an updated voucher that includes both Q2 and Q3 payments. These vouchers will be sent in October, prior to the November 1 deadline.
If you have already received your Q2 or Q3 payment vouchers from us, you may choose to adhere to the original payment deadlines or utilize the extended deadline of November 1. We recommend considering your cash flow needs when making this decision.
The IRS also offers specific relief for taxpayers who have suffered from disaster-related casualty losses. If your property was damaged or lost due to the storms and you were uninsured or underinsured, you may qualify to claim these losses on your federal income tax return. This can be done either for the year the disaster occurred (2024) or retroactively for the previous year (2023).
Here’s how it works: If you decide to claim a casualty loss, you must itemize your deductions and report the losses using Form 4684, Casualties and Thefts. Remember to reference the FEMA disaster declaration number, 4781-DR, on your return. This deduction can significantly reduce your tax liability if you've faced major property losses.
Furthermore, affected taxpayers have up to six months after the usual due date of their tax return to decide if they want to claim the loss on the return for the year of the disaster or the prior year. This provides additional time to assess the full extent of the damage and make an informed decision.
The bottom line is that there are no penalties for waiting to make your tax payments until the new, extended November 1 deadline. This can be particularly advantageous in managing your cash flow more effectively as you recover from any storm-related damages.
However, if you do want your payment vouchers for both June and September as normal this year, please reach out to us and we will be happy to send those over.
As always, we are here to make the complex simple. Please reach out to us if you have any questions.
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