Dept. of Tax and Fee Administration Announces Emergency Tax Relief Measures Following Storms

The California Department of Tax and Fee Administration (CDTFA) announced on Wednesday that business owners and tax payers who have been impacted by the recent California storms will be eligible for emergency state tax relief from late payment interest and penalties.

The rain and snow storms, which have been ongoing since December 26th, have caused record floods, mudslides, and imposed other difficulties for Californians, which includes paying taxes on time and sending out tax returns for the year. As a result, local, state, and federal tax agencies  have given numerous actions and measures extending deadlines for those affected, and offering certain forms of relief. Last week, the IRS announced that 2022 federal income and business tax returns, as well as tax payments, would have their filing dates extended by one month to May 15, 2023 in 31 counties due to the storms and subsequent damage that affected most of California. The extended deadline also goes beyond normal tax filings, covering tax payments, farm taxes, and payroll and excise tax returns.

On Wednesday, the state announced further tax relief, with business owners and taxpayers impacted by California’s winter storms now being eligible for emergency tax relief from late payment interest and penalties. According to a statement from the Governor’s office, small business owners who have been affected by “flooding, power outages, and other storm-related hardships” may request up to an additional three months to file their tax returns. In addition, taxpayers who faced return deadlines in the month of January will not have to pay interest and other penalties if they are unable to file their returns and pay taxes and fees by the original due date.

“Help is available for California businesses,” California Department of Tax and Fee Administration Director Nick Maduros said on Wednesday. “If you cannot file or make a payment on time because of the storms, please reach out to us, and we can offer some relief.”

Governor Gavin Newsom said in the same statement, “California is moving with the urgency this moment demands, rapidly bringing support to Californians recovering from the devastating impact of the recent storms. Business owners across the state can now access much-needed assistance to help accelerate their recovery efforts, including relief from interest and penalties.”

Tax experts told the Globe that tax payment delays and exemptions from having to pay late fees is often seen in the aftermath of major disasters, although in the past it has usually been more limited to larger scale hurricanes and tornadoes striking areas rather than continual storms.

“I’ve given tax help before, including to victims of Hurricane Katrina who had suffered major flooding in 2005 and fled to California, as well other times this sort of relief has happened in the past here, including after earthquakes,” explained accountant and tax filing professional Curt Atwood to the Globe on Wednesday. “If  you are eligible and really need that break, by all means take it. Some of these floods just plain destroyed paperwork and hard drives and anything else that had tax records for some unfortunate people out there, so they’ll need the extra time. But, far more likely, business owners and other residents will need to take some time recovering from this, especially from flood damage, and damages to the property, settling it with insurance companies, and so much more. If you need it, don’t hesitate.”

Those impacted needing state help can can request relief on the CDTFA website, by mail, in person at a field office, or by phone.