Important Tax Update for California Residents
As of June 2023: As previously announced (see below), most California residents do not have to file their 2022 tax returns or pay the tax due until October 16th, 2023, due to the storm relief.
However, we are seeing an increasing number of notices issued by the IRS stating that 2022 taxes are due shortly after clients have filed their 2022 tax returns. In other words, the IRS system is not recognizing the extended due date for tax payments and is auto-generating tax due notices for taxpayers who have filed their returns.
We have confirmed directly with the IRS that these notices for 2022 are being auto-generated and may be ignored. The payment due date remains October 16th, 2023, regardless of whether a taxpayer has filed their 2022 tax returns or not.
Due to the hazardous storms that have hit California in recent weeks, the IRS has announced that most California residents will have until October 16, 2023, to file various individual and business tax returns and to make tax payments. Tax Day, initially scheduled for April 18th this year, is therefore pushed to October 16, 2023.
The Franchise Tax Board (FTB) has now made a similar announcement on identical terms to the IRS so that the relief now applies to both federal and California filing deadlines and payment due dates.
California Counties Affected
Individuals and households that reside or have a business in the following counties qualify for tax relief:
Alameda, Colusa, Contra Costa, El Dorado, Fresno, Glenn, Humboldt, Kings, Lake, Los Angeles, Madera, Marin, Mariposa, Mendocino, Merced, Mono, Monterey, Napa, Orange, Placer, Riverside, Sacramento, San Benito, San Bernardino, San Diego, San Francisco, San Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Solano, Sonoma, Stanislaus, Sutter, Tehama, Tulare, Ventura, Yolo and Yuba.
There is no need to prove that you have been adversely affected by the storms – residing in an affected County is all that is required.
In addition, the FTB press release mentions that those who have suffered damages from the storm are now able to claim those losses on their California tax return. This is separate from the filing and payment relief which applies to all residents of the named counties, regardless of whether they have suffered an actual loss or not.
The IRS and FTB tax relief postpones various tax filing and payment deadlines until October 16, 2023. The following can be postponed to the October 16th deadline:
- Q4 Estimated Payments for 2022 – originally due January 17, 2023
- Q1 Estimated Payments for 2023 – originally due April 18, 2023
- Tax Day Balances due for 2022 - originally due April 18, 2023
- Tax Day 2022 Tax Return Filing Requirement - originally due April 18, 2023
- Business Returns for 2022 – originally due March 15 and April 18, 2023
- Eligible taxpayers will also have until October 16th to make 2022 contributions to their IRAs and Health Savings Accounts.
So, a little bit of shelter from the storm courtesy of the IRS and the FTB.
If you have any questions about this tax update, please contact BakerAvenue.
Recent Press Releases: