Living or operating a business in an area where wildfires are often risky and can be unpredictable. Unfortunately, the recent wildfires in California have either destroyed or caused business owners a number of other problems. However, the Internal Revenue Service has announced some tax relief measures for businesses that have been affected by the California wildfires. If your business requires accounting assistance to claim wildfire tax benefits, you should speak with an experienced Roseville CPA for business services. The recent California wildfires have led to many lost homes or businesses for residents of California, and the Cook CPA Group would like to help you get your business back on track. We understand that this is a difficult time for many Californians, and we are here for you. The Cook CPA Group is here to discuss tax relief for businesses affected by California wildfires.

How to Claim Tax Relief for Businesses Affected by California Wildfires

On August 14, 2020, a wildfire began just north of Los Angeles that began spreading through the mountains and towards residential and commercial areas. The wildfire named the Lake Fire, covered over 17,000 acres of land and caused many people to evacuate their homes and businesses. As of September 25, 2020, more than 25 wildfires have started to spread across the State of California. These fires have destroyed nearly 7,000 structures in California.

To combat the destruction caused by the California wildfires, the IRS has announced that victims of the wildfire have until December 15, 2020, to file an assortment of individual tax returns, business tax returns, and other outstanding tax payments. Specifically, the filing deadline for the following has been extended:

  • 2019 Extended Individual Tax Returns – If you successfully filed for an extension on your 2019 individual tax returns with an October 15, 2020 deadline. However, the IRS stated that because individual taxes were due on July 15, 2020, they are not eligible for relief.
  • 2020 Quarterly Estimated Tax Payments – 2020 3rd quarter estimated tax deadline moved from September 15, 2020, to December 15, 2020.
  • Quarterly Payroll and Excise Tax Returns – Quarterly payroll and excise tax returns were previously due on October 31, 2020, and are now due on December 15, 2020.

Additionally, if you operate a tax-exempt organization with tax deadline extensions until November 15, 2020, your filing deadline will also be increased.

Casualty Losses

If your business sustained uninsured or unreimbursed casualty losses due to the wildfires, you might also be eligible for tax relief. For example, if your business experienced casualty losses, you can claim these losses on your 2020 tax return, or you can deduct the casualty losses from your tax returns from 2019 if you filed for an extension on those returns.

To learn more about what areas of California are able to claim the extension for filing business taxes, you should continue reading and speak with an experienced Roseville tax return planning accountant.

Eligibility for California Wildfire IRS Tax Relief

It is important to note that the IRS has only provided tax relief for certain businesses affected by California wildfires. Specifically, the Federal Emergency Management Agency (FEMA) has released a list of areas that will be eligible to receive tax relief from the wildfires:

  • Butte
  • Lake
  • Mendocino
  • Monterey
  • Napa
  • San Mateo
  • Santa Barbara
  • Santa Cruz
  • Solano
  • Sonoma
  • Ventura
  • Yolo

This is not an exhaustive list. If the wildfires continue to spread, the affected localities will be added to the list, and they will be provided with the same tax relief as previous localities. If you are concerned about whether your business is eligible for relief, you could consult with an experienced CPA or even check the IRS website for updates.

Additionally, if your business has an address within one of the affected areas, you do not need to spend time contacting the IRS to receive the additional filing time for your business. Note, however, if you receive communication from the IRS about late penalties for corporate tax filings that were supposed to be postponed, you should be able to get the penalty removed.

You should also know that the IRS has provided some other relief for taxpayers in the wildfire-affected area. For example, the IRS will waive certain fees and request for copies of earlier tax returns.

The Cook CPA Group understands how the California wildfires have displaced many families and business owners, and we are dedicated to helping you manage your taxes during this difficult time. Taking time to meticulously file taxes while dealing with a disaster that has affected you and your family is a lot to ask of a person, and our accountants are here to alleviate your burdens and address your concerns. We can determine whether your business is eligible for tax relief from the wildfires and get you started on claiming your tax relief benefits.

Speak with Our Experienced California Tax Relief Accountants for Businesses Affected by California Wildfires

If your business was affected or destroyed by the California wildfires, you should contact an experienced Roseville accountant for corporate tax preparation as soon as possible. The accounting team at the Cook CPA Group has extensive experience dealing with a number of tax issues, and we would be pleased to work with you during this uncertain time. To schedule a free consultation to discuss tax relief for your business, contact the Cook CPA Group at (916) 432-2218. You may also contact our firm online to schedule your free consultation.