The IRS has announced tax relief for individuals and businesses affected by Hurricane Debby across five states, including Florida, Georgia, North Carolina, South Carolina and Vermont. Affected taxpayers now have until Feb. 3, 2025, to file various federal individual and business tax returns and make tax payments.  

To qualify for tax relief, individuals and households must reside or have a business in any one of the states’ counties where a disaster was declared by Federal Emergency Management Agency (FEMA).  

A list of disaster-declared counties can be found on the tax relief in disaster situations page on IRS.gov. 

Filing and Payment Relief  

The tax relief postpones various tax filing and payment deadlines that occurred beginning Aug. 1, 2024, in Florida, Aug. 4, 2024, in Georgia and South Carolina, Aug. 5, 2024, in North Carolina and Aug. 8, 2024, in Vermont. The relief period continues through Feb. 3, 2025 (postponement period), in all five states. As a result, affected individuals and businesses will have until Feb. 3, 2025, to file returns and pay any taxes originally due during this period.  

This means, for example, the Feb. 3, 2025, deadline will now apply to: 

• Any individual, business or tax-exempt organization that has a valid extension to file their 2023 federal return. The IRS noted, however, that payments on these returns are not eligible for the extra time because they were due last spring before the hurricane occurred. 
• Quarterly estimated income tax payments normally due on Sept. 16, 2024, and Jan. 15, 2025. 
• Quarterly payroll and excise tax returns normally due on Oct. 31, 2024, and Jan. 31, 2025.  

In addition, penalties for payroll and excise tax deposits due between certain periods will be abated based on the dates noted below:  

• Florida: Penalties for failing to make payroll and excise tax deposits due on or after Aug. 1, 2024, and before Aug. 16, 2024, will be abated, as long as the deposits are made by Aug. 16, 2024.  
• South Carolina and Georgia: Penalties for failing to make payroll and excise tax deposits due on or after Aug. 4, 2024, and before Aug. 19, 2024, will be abated, as long as the deposits are made by Aug. 19, 2024. 
• North Carolina: Penalties for failing to make payroll and excise tax deposits due on or after Aug. 5, 2024, and before Aug. 20, 2024, will be abated, as long as the deposits are made by Aug. 20, 2024. 
• Vermont: Penalties for failing to make payroll and excise tax deposits due on or after Aug. 8, 2024, and before Aug. 23, 2024, will be abated, as long as the deposits are made by Aug. 23, 2024. 

The disaster assistance and emergency relief for individuals and businesses page has details on other returns, payments and tax-related actions qualifying for relief during the postponement period. The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. These taxpayers do not need to contact the agency to get this relief. 

It is possible an affected taxpayer may not have an IRS address of record located in the disaster area, for example, because they moved to the disaster area after filing their return. In these unique circumstances, the affected taxpayer could receive a late filing or late payment penalty notice from the IRS for the postponement period. The taxpayer should call the number on the notice to have the penalty abated. 

Additional Tax Relief 

In addition to the postponed IRS deadlines for taxpayers impacted by Hurricane Debby, there may be some additional relief, such as:  

• Casualty loss deduction. Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed disaster-related losses can choose to claim them 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). Taxpayers have extra time – up to six months after the due date of the taxpayer’s federal income tax return for the disaster year (without regard to any extension of time to file) – to make the election. For individual taxpayers, this means Oct. 15, 2025. Be sure to write the FEMA declaration number – 4798-DR − on any return claiming a loss.  
• Gross income exclusion. Qualified disaster relief payments are generally excluded from gross income. 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 the repair or replacement of its contents. 
• 401(K) distributions or withdrawals. 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 its participants to follow, so it’s important to work with your plan provider to ensure you minimize your tax liability.   

The IRS may provide additional disaster relief in the future. Doeren Mayhew’s tax pros will continue to monitor additional relief announced by the IRS.