Tax Deadlines Extended for Alabama Storm and Flooding Victims

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Residents of two Alabama counties can wait until February 28, 2022, to file and pay certain federal taxes. The IRS extended various tax deadlines because of the severe storms and flooding that occurred on October 6, 2021, in parts of the state that were declared a disaster area by the Federal Emergency Management Agency (FEMA). The tax relief applies to residents and businesses in Jefferson and Shelby Counties who were affected by the storms and flooding.

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Various federal tax filing and payment due dates for individuals and businesses from October 6 to February 27 will be shifted to February 28. This includes the quarterly estimated tax payments that are due on January 18, 2022.

The tax relief also applies to the quarterly payroll and excise tax returns normally due on January 31, 2022. Penalties on payroll and excise tax deposits due from October 6 to October 20 will also be waived if the deposits were made by October 21, 2021.

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You don't have to contact the IRS to get this relief. However, if you receive 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, you should call the number on the notice to have the penalty abated.

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The IRS will also waive fees for obtaining copies of previously filed tax returns for taxpayers affected by the storms and flooding. When requesting copies of a tax return or a tax return transcript, write "Alabama – Severe Storms and Flooding" in bold letters at the top of Form 4506 (copy of return) or Form 4506-T (transcript) and send it to the IRS.

In addition, the IRS will work with any taxpayer who lives outside Alabama, but whose records necessary to meet a deadline occurring during the postponement period are located in the state. Taxpayers qualifying for relief who live in another state need to contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.

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 2021 return normally filed in 2022), or the return for the prior year. This means that taxpayers can, if they choose, claim these losses on their 2020 return. Be sure to write the FEMA declaration number (DR-4632-AL) on any return claiming a loss. It's also a good idea for affected taxpayers claiming the disaster loss on a 2020 return to put the Disaster Designation ("Alabama – Severe Storms and Flooding") in bold letters at the top of the form. See IRS Publication 547 for details.

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Rocky Mengle was a Senior Tax Editor for Kiplinger from October 2018 to January 2023 with more than 20 years of experience covering federal and state tax developments. Before coming to Kiplinger, Rocky worked for Wolters Kluwer Tax & Accounting, and Kleinrock Publishing, where he provided breaking news and guidance for CPAs, tax attorneys, and other tax professionals. He has also been quoted as an expert by USA Today, Forbes, U.S. News & World Report, Reuters, Accounting Today, and other media outlets. Rocky holds a law degree from the University of Connecticut and a B.A. in History from Salisbury University.