Impacted by Hurricanes Helene or Milton? Here’s Some IRS Tax Relief to Keep in Mind
In the wake of the devastating hurricanes that have ravaged Florida and the Southeast in recent weeks, the IRS reassured victims that it stands ready to provide the tax-related assistance they need to recover from these storms.
Here is a rundown on tax help available from the IRS.
More Time to File and Pay
Currently, taxpayers in the entire states of Alabama, Florida, Georgia, North Carolina and South Carolina, and parts of Tennessee and Virginia, who received extensions to file their 2023 returns have until May 1, 2025, to file. Tax-year 2023 tax payments are not eligible for this extension. In addition, May 1, 2025, is also the deadline for filing 2024 returns and paying any tax due.
If you were impacted by the recent hurricanes, click on the state in which you reside in below to view the latest tax relief available to you:
The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA). The current list of eligible localities is always available on the Tax relief in disaster situations page on IRS.gov.
Disaster Payments Usually Tax-Free
Qualified disaster relief payments are generally excluded from gross income. In general, this means affected taxpayers can exclude from their gross income amounts received from a government agency for reasonable and necessary personal, family, living or funeral expenses, as well as for the repair or rehabilitation of their home, or for the repair or replacement of its contents. See Publication 525, Taxable and Nontaxable Income, for details.
Retirement Plan Help
Additional relief may be available to affected taxpayers who participate in a retirement plan or individual retirement arrangement (IRA). For example, a taxpayer may be eligible to take a special disaster distribution that would not be subject to the additional 10% early distribution tax and allows the taxpayer to spread the income over three years. Taxpayers may also be eligible to make a hardship withdrawal. Each plan or IRA has specific rules and guidance for their participants to follow.
Disaster Loss Deduction May be Available
In some instances, individuals and businesses in a federally-declared disaster area can qualify for a casualty loss tax deduction. The deduction is available for damaged or destroyed property not covered by insurance or other reimbursement and can result in a larger refund.
A unique feature of this deduction is that taxpayers can choose to claim it on either the return for the year the loss occurred (in this instance, the 2024 return normally filed next year), or the return for the prior year (the 2023 return filed this year). For individual taxpayers, the deadline for making this election is Oct. 15, 2025.
If deductions exceed a taxpayer’s income, it can result in a net operating loss (NOL). A taxpayer need not have a business to have a NOL from a casualty. A NOL can normally be carried forward and deducted in a future tax year.
Free Tax Transcripts and Copies of Returns Available
Disaster-area taxpayers whose tax records were lost or destroyed and needs them to apply for disaster assistance can get a free transcript or copy of their returns from the IRS. Immediate access to tax transcripts is available through Get Transcript.
The IRS waives the usual fees and expedites requests for copies of returns for people who need them to apply for disaster-related benefits or to file amended returns claiming disaster-related losses. To speed processing, be sure to notate that this is a disaster-related request and list the state and type of event.
As a reminder, taxpayers must have filed all required tax returns to qualify for disaster loans or grants for business owners, homeowners and renters from the Small Business Administration.
Here to Assist
IRS.gov has a variety of information to help disaster victims navigate common situations in the aftermath of disasters. There is also a special hotline specifically dedicated to taxpayers with disaster-related tax questions. The disaster hotline number is 866-562-5227.
Doeren Mayhew’s dedicated business and individual tax pros are also here to help navigate through your recovery efforts. To obtain assistance, contact our pros today.
