Victims of severe storms earlier this year in Alabama, Kentucky and Tennessee will have more time to file their 2020 federal income tax return. For Kentucky storm victims, the due date is now June 30, 2021; for Alabama and Tennessee victims, it's August 2, 2021. The announcements from the IRS about the extra time follow disaster area declarations from the Federal Emergency Management Agency (FEMA) for those three states. Taxpayers in other states impacted by the storms that receive similar FEMA disaster declarations will automatically receive the same filing and payment relief.
In Kentucky, people affected by the February 27 severe storms, flooding, landslides, and mudslides who reside or have a business in Anderson, Bell, Boyd, Breathitt, Calloway, Carter, Casey, Clark, Clay, Cumberland, Edmonson, Elliott, Estill, Fayette, Floyd, Franklin, Graves, Greenup, Harlan, Jackson, Jessamine, Johnson, Knott, Knox, Lawrence, Laurel, Lee, Leslie, Letcher, Lincoln, Madison, Magoffin, Marion, Martin, Mason, Menifee, Morgan, Ohio, Owsley, Perry, Pike, Powell, Pulaski, Rockcastle, Union, Warren, Whitley, Wolfe, and Woodford Counties qualify for tax relief.
In Alabama, the tax relief is available for people impacted by the March 25 severe storms, straight-line winds, and tornadoes who reside or have a business in Bibb, Calhoun, Clay, Hale, Jefferson, Perry, Randolph, and Shelby Counties.
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In Tennessee, the additional time is allowed for victims of severe storms, straight-line winds, tornadoes, and flooding on March 25 in Campbell, Cannon, Cheatham, Claiborne, Clay, Davidson, Decatur, Fentress, Grainger, Hardeman, Henderson, Hickman, Jackson, Madison, Maury, McNairy, Moore, Overton, Scott, Smith, Wayne, Williamson, and Wilson Counties.
Various federal tax filing and payment due dates for Kentucky individuals and businesses between February 27 and June 29 will be shifted to June 30. Likewise, for Alabama and Tennessee individuals and businesses, federal deadlines between March 25 and August 1 will be moved to August 2. In addition to the May 17 personal income tax filing deadline, this includes:
- 2020 IRA contributions originally due on May 17;
- Quarterly estimated income tax payments normally due on April 15 and June 15;
- Quarterly payroll and excise tax returns ordinarily due on April 30; and
- 2020 returns for tax-exempt organizations typically due on May 17.
In Kentucky, penalties on payroll and excise tax deposits due from February 27 to March 14 will also be waived if the deposits were made by March 15. In Alabama and Tennessee, the same applies for deposits due from March 25 to April 8 they're made by April 9.
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.
In addition, the IRS will work with any taxpayer who lives elsewhere, but whose records necessary to meet a deadline occurring during the postponement period are in Alabama, Kentucky or Tennessee. 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 and anyone visiting the covered disaster area who was killed or injured because of the storm.
People 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 next year), or the return for the prior year. This means that taxpayers can, if they choose, claim these losses on the 2020 return they are filling out this tax season. Be sure to write the FEMA declaration number (4595-DR for Alabama, 4595-DR for Kentucky, 4601-DR for Tennessee) 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 (e.g., "Alabama – Severe Storms, Straight-line Winds, and Tornadoes" or "Kentucky – Severe Storms, Flooding, Landslides, and Mudslides" or "Tennessee Severe Storms, Straight-line Winds, Tornadoes, and Flooding") in bold letters at the top of the form. See IRS Publication 547 for details.
[NOTE: Similar tax relief is available for victims of winter storms in Texas, Oklahoma and Louisiana.]
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