Legislation has been enacted which will allow the IRS to grant tax relief when a governor declares either a disaster or state emergency rather than waiting for a federal disaster declaration. The Filing Relief for Natural Disasters Act unanimously passed the House in April and the Senate in July and was signed by the President, becoming law on July 24th.

Previously, the IRS had to wait for the federal government to declare a disaster before postponing federal tax deadlines, including (but not limited to) deadlines for filing federal tax returns, paying federal taxes, making retirement plan contributions, assessing taxes, and pursuing collections.

“This is a significant win for us and for taxpayers,” President/CEO Karen Moody said. “Along with the AICPA and other state societies, we have advocated for this legislation for several years, including most recently during our visits on Capitol Hill in May. In the past we have fought tooth and nail for relief on certain disasters in Mississippi, several which hit near tax deadlines. The delays waiting for a federal declaration and then for the IRS to respond with relief caused our members and their clients anxiety during already stressful times.”

The legislation also increases the automatic extension of such federal tax deadlines for certain relief workers, individuals killed or injured as a result of a federally declared disaster, and taxpayers whose principal residence, business, or tax records are located in a federally declared disaster area from 60 days to 120 days.

The bill defines a qualified state-declared disaster as any natural catastrophe, fire, flood, or explosion which in the determination of the governor causes damage of sufficient severity and magnitude to warrant a request to postpone such federal tax deadlines. The new law will apply to declarations made after the date of the enactment of the Act.