Federal and California State Wildfire Tax Relief for Business Owners

Federal and California State Wildfire Tax Relief for Business Owners

January 31, 2025

The devastating wildfires in the Los Angeles area are nearing full containment, but the impact on individuals and those who do business in the stricken region remain at the very beginning of their recovery.  The Internal Revenue Service (IRS) and the State of California offer those within the disaster area (and relief workers affiliated with government or philanthropic organizations assisting with the recovery efforts) various forms of relief such as deadline extensions, guidance, and fee waivers. 

IRS Federal Tax Extensions

The IRS issued a notice on January 10, 2025, providing automatic relief beginning on January 7th to taxpayers with prior filing addresses within the area designated by the Federal Emergency Management Agency (FEMA) under Disaster Response 4856. To alert the IRS of their qualification, taxpayers who were affected but had a different address due to moving after their last filing (or for other reasons) should contact the IRS directly at 866-562-5227.

Tax Return and Payment Deadlines

The new deadline for many tax activities is October 15, 2025.

  • Individuals who live in or have a business in Los Angeles County now have until October 15, 2025, to file returns and pay taxes.
  • Businesses with estimated payments that normally would be due on January 15, April 15, June 16, and September 15, 2025, also have until October 15th to make their payments.
  • The following calendar year returns are extended to October 15, 2025:
    • Partnership and S-corporation returns (normally due March 17, 2025)
    • Corporation and fiduciary returns and payments (normally due April 15, 2025)
    • Tax-exempt organization returns (normally due May 15, 2025)

Penalty Abatements

Penalties for failing to make payroll and excise tax deposits due on or after January 7, 2025, and before January 22, 2025, will be abated if the deposits were made by January 22, 2025.

Loss Recovery

Those individuals and businesses in the federally declared disaster area who suffer uninsured or unreimbursed disaster-related losses can choose to claim them on either their 2024 or 2025 tax returns. The due date for claiming these losses is 6 months following the return due date, which will be October 15, 2026. More information can be found in IRS Publication 547.

California Tax Extensions

With over 16,000 structures destroyed, California’s Governor Newsom issued a January 29, 2025, press release adding more assistance measures to those previously announced for affected businesses.

  • The state extends income tax returns and payments to match the federal October 15, 2025, due date.
  • The state automatically extends sales and use tax returns and payments to April 20, 2025, for Los Angeles County taxpayers who normally must file by January 31, 2025.
  • Los Angeles County property owners can file for tax relief with form ADS-820 for losses that exceed $10,000 of current market value.
  • The state grants a one-year extension for paying renewed licenses, certificates, and permits with renewal dates between January 1, 2025, and July 1, 2025.
  • The state waives fees for businesses and workers who request duplicate or replacement license certificates that were burned or destroyed.
  • The state extends deadlines for businesses to appeal license-related proceedings.
  • The state eliminates requirements that hinder relocation of certain businesses impacted by the fires.

You can find additional information and updates on California’s LA Fires Help Your Business page.

Recovery Assistance is Available

The destruction of 90 square miles of property and land by the fires in the Los Angeles community is nearly unfathomable to those experiencing and witnessing it. The REDW team extends their condolences to those who have suffered losses. Please contact us if you are in need of tax or financial guidance.

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