Victims of disasters receive more time to file and pay February 2019 Tax News

Disaster loss rules apply to victims in Governor-declared or presidentially-declared disaster areas.

• We automatically follow federal postponement periods for any presidentially-declared disasters.
• California law generally follows federal law regarding the treatment of losses incurred as a result of a casualty or a disaster.
• Taxpayers may deduct a disaster loss for any loss sustained in California that is proclaimed by the Governor to be in a state of emergency.

The affected taxpayers impacted by Northern and Southern California wildfires in 2018 are granted an extension to file 2018 California tax returns and make payments until April 30, 2019.

The IRS granted relief to individuals and businesses in 3 counties for 2018: Butte, Los Angeles and Ventura. This applies to various tax filing and payment deadlines that occurred starting on November 8, 2018, including: 

• Individual income tax returns normally due on April 15, 2019. 
• Quarterly estimated tax payments due January 15, and April 15, 2019.

We will also follow these extended dates and will cancel interest and any late filing or late payment penalties that would otherwise apply.

Your clients may claim a disaster loss in 1 of 2 ways: In the tax year that the disaster occurred, when filing a 2018 tax return spring 2019; or by filing either an amended or original 2017 tax return. We can more quickly issue a refund for eligible claimed losses in the prior tax year.

For a complete list of all disasters declared by the Governor, see the “Qualified Disasters” chart on our Disaster Loss webpage. Get Disaster Loss - How to Claim a State Tax Deduction (FTB Pub. 1034) for more information and instructions.

For your clients claiming the disaster loss, you should write the name of the disaster in red ink at the top of the tax return to alert us to expedite the refund. If you are e-filing, follow the software instructions to enter disaster information.

Additional business tax relief for wildfire victims is available through the California Department of Tax and Fee Administration and the Employment Development Department.