IRS announces tax relief for Nebraska and Iowa victims from Presidentially declared natural disaster.
On March 22, 2019, the Internal Revenue Service (IRS) announced that taxpayers who were affected by the severe winter storms, straight-line winds, and flooding that took place on March 9, 2019, in Nebraska may qualify for tax relief. On March 25, the IRS issued another notice providing relief for specific areas in Iowa.
Individuals who reside in or have a business in the following Nebraska counties may qualify for relief: Butler, Cass, Colfax, Dodge, Douglas, Nemaha, Sarpy, Saunders, and Washington. Fremont, Harrison, Mill, Monona, and Woodbury counties in Iowa may also qualify for relief. Like tax relief for other major disasters, these provisions also extend to taxpayers not located within the declared disaster area but whose records necessary to meet a tax filing deadline are located within the impacted declared areas. Additionally, impacted taxpayers include workers assisting with the relief efforts who are affiliated with a recognized government or philanthropic organization.
Areas of relief granted:
- Certain deadlines falling on or after March 9, 2019, and before July 31, 2019, for Nebraska locations and deadlines on or after March 12, 2019, and before July 31, 2019, for Iowa locations are granted additional time to file through July 31, 2019.
- This includes 2018 individual income tax returns and payments normally due on April 15, 2019, as well as tax-exempt organizations on a calendar year basis that have a Form 990 due on May 15, 2019.
- This also includes quarterly estimated tax payments due on April 15, 2019, and June 17, 2019, as long as such payments are paid on or before July 31, 2019.
- Eligible taxpayers have until July 31, 2019, to make 2018 IRA contributions.
- Penalties on payroll and excise tax deposits due on or after March 9, 2019, and before March 25, 2019, will be abated as long as the deposits were made by March 25, 2019, for Nebraska affected counties; deposits due on or after March 12, 2019, and before March 27, 2019, for Iowa affected counties will also be abated if the deposits are made by March 27, 2019.
If affected taxpayers receive a late filing or late payment penalty notice that has an original or extended filing, payment, or deposit due date that falls within the postponement period, they should call the number on the notice to have the IRS abate the penalty.
The IRS should automatically identify taxpayers who reside or are located in the covered disaster area and apply automatic filing and payment relief. Affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 866-562-5227 to request this tax relief.
Other notable relief areas:
While personal casualty losses are no longer deductible beginning with the 2018 tax year as because of the tax reform, affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either the year in which the event occurred or the prior year. This includes personal property losses that are not covered by insurance or other reimbursements. Anyone claiming the disaster loss on a 2018 or 2019 return should use the Disaster Designation, “Nebraska, severe winter storm, straight-line winds, and flooding.” Include this information at the top of the form so the IRS can expedite processing the refund. Also include the disaster declaration number, FEMA 4420, on any return.
Affected taxpayers can have the IRS fees and expedite requests for copies of previously filed tax returns. The assigned Disaster Designation “Nebraska, severe winter storm, straight-line winds, and flooding” should be included in red ink at the top of Form 4506, Request for Copy of Tax Return (PDF) or Form 4506-T, Request for Transcript of Tax Return (PDF), as appropriate.
The IRS may contact affected taxpayers w a collection or examination matter. Those individuals should explain how the disaster impacts them so the IRS can provide appropriate consideration to its case.