Tax Relief Available to Victims of Hurricane Ida in New York and New Jersey

The IRS has issued IR-2021-179 granting victims of Hurricane Ida located in New York and New Jersey to file various individual and business tax returns and make tax payments until January 3, 2022.

The IRS is offering this relief to any area designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual or public assistance. In New York, this currently includes Bronx, Kings, New York, Queens, Richmond and Westchester counties, and in New Jersey, it includes Bergen, Gloucester, Hunterdon, Middlesex, Passaic and Somerset counties. Taxpayers in Ida-impacted localities subsequently designated by FEMA in other parts of these states will automatically receive the same filing and payment relief.

• The tax relief postpones various tax filing and payment deadlines starting on September 1, 2021. As a result, affected individuals and businesses will have until January 3, 2022, to file returns and pay any taxes that were originally due during this period. This means individuals who had a valid extension to file their 2020 return due to run out on October 15, 2021, will now have until January 3, 2022, to file. The IRS noted, however, that because tax payments related to these 2020 returns were due on May 17, 2021, those payments are not eligible for this relief. 

• The January 3, 2022, deadline also applies to quarterly estimated income tax payments due on September 15, 2021, and the quarterly payroll and excise tax returns normally due on November 1, 2021. It also applies to tax-exempt organizations, operating on a calendar-year basis, that had a valid extension due to run out on November 15, 2021. Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2020 extensions run out on October 15, 2021.

• In addition, penalties on payroll and excise tax deposits due on or after September 1 and before September 10, will be abated as long as the deposits are made by September 10, 2021.
  
  

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. Therefore, taxpayers do not need to contact the agency to get this relief. However, 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 contact us immediately to have the penalty abated.

The New Jersey Division of Taxation has issued guidance following the federal guidelines for tax relief for victims of Hurricane Ida. To date, however, the New York Division of Taxation and Finance has yet to issue any guidance on whether they will also follow the federal guidelines. If you live in one of the designated counties listed above, were negatively affected by Hurricane Ida, and believe that this extension of time is absolutely necessary to properly and timely file your federal and state tax returns, please reach out to your LMC contact and we will assist accordingly.