Tax Relief Alert: California Wildfire Survivors Get Filing Extensions Until October 2025!
The IRS has rolled out critical tax relief measures for Californians impacted by the devastating wildfires that began in January 2025. These efforts aim to give residents and businesses in affected areas more time to recover without the added stress of immediate tax deadlines. Here’s what you need to know.
Who Qualifies for Relief?
The tax relief is available to individuals and businesses located in areas designated as federal disaster zones by FEMA. At this time, Los Angeles County has been confirmed as eligible, but additional counties could be added if FEMA expands its declaration.
What Kind of Relief Is Offered?
Taxpayers in these disaster zones will see various deadlines for filing returns and making payments extended to October 15, 2025. This includes:
- Individual Income Tax Returns: If your 2024 tax return was originally due on April 15, 2025, you now have until October 15 to file and pay.
- Estimated Tax Payments: Payments typically due on January 15, April 15, June 16, and September 15, 2025, are all postponed.
- Business Tax Deadlines: Key business filings, including partnership and S corporation returns originally due on March 17, 2025, and payroll tax returns due on January 31, April 30, and July 31, are also extended.
- IRA and HSA Contributions: Eligible taxpayers can make 2024 contributions to Individual Retirement Accounts (IRAs) and Health Savings Accounts (HSAs) up until October 15, 2025.
Automatic Eligibility
There’s no need to apply for this relief qualifying individuals and businesses will be identified automatically based on their addresses in the disaster areas. If you receive a late-filing or late-payment notice, you should contact the IRS to request abatement.
State Tax Relief
The California Franchise Tax Board (FTB) has announced a similar extension for state tax deadlines, matching the October 15, 2025, federal deadline. This means you won’t have to navigate separate timelines for your federal and state taxes.
Accessing Retirement Funds Without Penalty
For those needing extra financial support, there’s additional help. Under the SECURE 2.0 Act, wildfire victims can withdraw up to $22,000 from retirement accounts like 401(k)s or IRAs without paying the 10% early withdrawal penalty. The withdrawn amount can be repaid over three years to avoid income taxes, or the taxes can be spread across three years if not repaid.
Claiming Disaster Losses on Your Taxes
If you’ve suffered financial losses due to the wildfires, you can claim them on your tax return. These disaster-related losses can be reported on your 2024 return or, if preferred, on an amended 2023 return for a quicker refund.
What You Should Do Next
If you’re in the affected areas, take advantage of the extended deadlines to focus on your recovery. Whether you’re a homeowner, renter, or business owner, it’s important to document any disaster-related losses for potential deductions. And if you’re unsure about your eligibility or need help navigating these tax benefits, consult a tax professional or visit the IRS website for detailed guidance.
This tax relief offers a lifeline to thousands of Californians still grappling with the aftermath of this year’s wildfires. With extended deadlines and flexible options, the IRS is providing crucial support during these challenging times.
