IRS Announces Relief for California Wildfire Victims

The IRS announced relief for individuals and businesses in Southern California affected by wildfires and winds that began on Jan. 7, 2025. Taxpayers qualifying for relief have until Oct. 15, 2025, to file various federal individual and business tax returns and make payments.

Relief is being extended to areas designated as federal disaster areas by the Federal Emergency Management Agency (FEMA). Currently, this area includes individuals and businesses located in Los Angeles County. Other areas added by FEMA to the disaster area at later dates also will qualify for the relief. The current updated list of eligible counties is available on the disaster relief page on the IRS website.

The California Franchise Tax Board also has announced similar relief for affected taxpayers in Los Angeles County with California filing and payment obligations.

Filing and payment requirements covered

This relief covers and postpones various deadlines beginning on Jan. 7, 2025, and extends through Oct. 15, 2025. Individuals and businesses have until Oct. 15, 2025, to file returns and pay taxes due during this period. Included in the returns covered by this relief are 2024 individual income tax returns originally due April 15, 2025, as well as various 2024 business tax returns due on March 17, 2025, and April 15, 2025.

In addition to extending tax payments due, the relief also covers the 2024 quarterly estimated income tax payments normally due on Jan. 15, 2025, and 2025 estimated tax payments, which otherwise are due on April 15, June 16, and Sept. 15, 2025.

Other payments affected are quarterly payroll and excise tax returns, which otherwise would be due Jan. 31, April 30, and July 31, 2025. Penalties on payroll and excise tax deposits due on or after Jan. 7, 2025, and before Jan. 22, 2025, will be abated if the deposits are made by Jan. 22, 2025. The relief also extends the deadline for making 2024 contributions to IRAs and health savings accounts until Oct. 15, 2025.

Crowe observation

While the relief is welcome and taxpayers should use it as needed, taxpayers able to meet the regular due dates should consider doing so, as taking advantage of the relief also extends the filing season and shortens taxpayers’ break from compliance activities that usually follows filing season.

Looking ahead

The relief provided will be automatically applied by the IRS to any taxpayers with addresses within the disaster area. Taxpayers in the disaster area that take advantage of the relief and that later receive penalty notices should contact the IRS directly or through their tax advisers to have the penalties abated properly. Taxpayers that are located outside the disaster area but have records necessary to complete their filing obligations located within the disaster area also should qualify for relief, but they might need to work with the IRS and their tax advisers to have the relief applied retroactively.