California Taxpayers Get More Time to File and Pay Due to Winter Disasters

The California Franchise Tax Board (FTB) has announced that most Californians have an extra month to file and pay their state taxes for the year 2022. This is because of the winter natural disasters that affected 55 counties in the state.

What is the new deadline?

The new deadline for filing and paying California state taxes is November 16, 2023. This applies to most taxpayers who were affected by the winter storms, floods, mudslides, and wildfires that occurred between January 26 and March 19, 2023. These disasters were declared as presidentially declared disasters by the federal government.

California Taxpayers Get More Time to File and Pay Due to Winter Disasters
California Taxpayers Get More Time to File and Pay Due to Winter Disasters

The original deadline for filing and paying state taxes was April 18, 2023. However, California grants an automatic extension until October 16, 2023 to file the return, although the payment is still due by April 18, 2023. With the relief, those who would have had an October 16, 2023, postponed tax filing deadline now have until November 16, 2023, to file and pay.

How does this affect federal taxes?

The Internal Revenue Service (IRS) has also extended the deadline for filing and paying federal income taxes for the same taxpayers to November 16, 2023. The IRS announced this on October 16, 2023, after reviewing the damage caused by the winter disasters in California.

The IRS extension applies to individual taxpayers, businesses, estates, trusts, and other entities that are located in the disaster areas or have records necessary to meet their tax obligations in the disaster areas. The IRS also waives penalties and interest on any taxes due during the postponement period.

How can taxpayers claim a disaster loss deduction?

Taxpayers who suffered a loss due to the winter disasters may claim a deduction for a disaster loss on their state and federal tax returns. This can help them reduce their taxable income and get a refund sooner.

Taxpayers can claim a disaster loss in one of two ways:

  • They may claim the disaster loss for the 2023 tax year when they file their return next spring.
  • They may claim the loss against 2022 income on this year’s return or an amended return.

The advantage of claiming the disaster loss on a tax year 2022 return is that taxpayers can get their refund sooner. However, they should compare both options and choose the one that gives them the best tax benefit.

To claim a disaster loss deduction, taxpayers should write the name of the disaster (for example, California winter storms) in blue or black ink at the top of their tax return. If they are filing electronically, they should follow the software instructions to enter disaster information.

Taxpayers should also keep records of their losses, such as receipts, photos, insurance reports, and appraisals. They should use Form FTB 3805V for state taxes and Form 4684 for federal taxes to calculate their deduction amount.

How can taxpayers get more information and assistance?

Taxpayers who need more information or assistance can visit the FTB website or call FTB at (800) 852-5711. They can also visit the IRS website or call IRS at (800) 829-1040.

Taxpayers who receive a late filing or late payment penalty notice related to the postponement period should call the number on the notice to have the penalty abated. They can also request free copies of their state and federal returns to replace those lost or damaged by the disasters.

Taxpayers who are facing financial hardship or need more time to pay their taxes can apply for an installment agreement or an offer in compromise with FTB or IRS. They can also request a waiver of fees or interest if they can show reasonable cause for their inability to pay.

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