Tax relief granted for Oregon fire victims

Victims of the Oregon wildfires that began on Sept. 7 now have until January to file various federal individual and business returns and make tax payments.

The IRS is offering this relief to any area designated by the Federal Emergency Management Agency as qualifying for individual assistance. Currently this includes Clackamas, Douglas, Jackson, Klamath, Lane, Lincoln, Linn and Marion Counties in Oregon, but taxpayers in localities added later to the disaster area will automatically receive the relief.

The relief postpones filing and payment deadlines that occurred starting on Sept. 7. Affected individuals and businesses will have until Jan. 15 to file returns and pay any taxes that were due during this period. Those who had a valid extension to file their 2019 return by Oct. 15 now also have until Jan. 15 to file (payments related to 2019 returns, which were due on July 15, are ineligible for this relief).

The Jan. 15 deadline also applies to quarterly estimated income tax payments due on Sept. 15 and quarterly payroll and excise tax returns normally due on Nov. 2. It also applies to tax-exempt organizations operating on a calendar-year basis that had a valid extension due to run out on Nov. 16.

Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2019 extensions run out on Oct. 15.

Penalties on payroll and excise tax deposits due on or after Sept. 7 and before Sept. 22 will be abated as long as the deposits are made by Sept. 22.

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. If an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date falling within the postponement period, the taxpayer should call the number on the notice to have the penalty abated.

Taxpayers qualifying for relief who live outside the disaster area need to 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 2020 return normally filed next year), or the return for the prior year (2019). Taxpayers should write the declaration number – 4562 for the wildfires in Oregon – on returns claiming a loss.

The IRS gave similar relief for victims of wildfires in California.

Also, Senate Democrats have introduced legislation to offer tax relief to individuals, businesses and states affected by wildfires like the ones devastating California, Oregon and Washington State, along with other presidentially declared disasters, such as Hurricane Sally.