Although many small businesses have already either filed their tax returns or have filed their Form 4868 for the purpose of requesting an extension, there are many small businesses and individuals who may receive an extension without having even to request permission from the IRS.
In an April 16th, 2018 IRS news release ” The IRS said nearly 14 million taxpayers are expected to get an extension this filing season.” Businesses who have fallen victim to any of the following circumstances will be automatically granted additional filing time regardless as to whether or not they have had the opportunity actually to request permission for extension formally.
We would like to provide detailed information pertaining to exactly who may have undocumented permission from the IRS, deadline dates and various forms and publications to help victims of special circumstances:
If Your Business Has Fallen Victim to Natural Disasters:
- If your business was affected by wildfires, mudslides or flooding in portions of Southern California, you would have until April 30, 2018, to file and pay your business taxes. The IRS also includes relief by offering additional time to make contributions to your 2017 IRA. The same will apply to organizations holding tax-exempt status.
- If your business was located in Puerto Rico or the U.S. Virgin Islands and your business was affected by Hurricane Maria, you will automatically qualify for an extension to file your tax returns and pay taxes owed by June 29, 2018. This same date shall apply to businesses that had fallen victim to Tropical Storm Gita that occurred in American Samoa.
- For more extensive information, please feel free to review the updated Disaster Relief IRS Publication 976
Additional Publications for Other Special Circumstances:
- Publication 54 Tax Guide For U.S. Citizens and Resident Aliens Abroad will offer information regarding filing and tax payment rules for those who own businesses or are currently working abroad.
- Penalty Relief Due to Reasonable Circumstances If your small business or yourself as an individual have experienced a disaster such as fire, casualty or any other serious disturbance, the IRS may be willing to remove penalties from what you owe. To see if you may be eligible for removal of IRS tax penalty amounts, read this publication to see if you qualify. You will only approach these issues if the IRS has actually mailed you notice with regard to penalties.
- Armed Forces Tax Guide 2017 will offer updated information pertaining to those who are currently serving in all branches of the U.S. Armed Forces and are still located in combat zones.
2017 was a trying time for so many Americans, and the Internal Revenue Service is more willing than ever to offer solutions, to what can be very difficult and complicated small business tax issues. The devastating natural disasters that had occurred in 2017 has not only prompted the Legislature and the IRS to provide lengthy extensions for filing and payment. If your business has been affected and you’ve not yet filed, be certain to take advantage of other disaster-related situations that may have affected your business and your employees. The IRS is willing to help.
If your business was located in an area that was declared a disaster area and you retained your employees until the business had become operable, you may still receive a retention credit. This credit will be offered to any employer who retained their employees long enough to have paid them at least $6000.00. At that point, you will receive a $2400.00 tax credit for every employee you had retained and paid $6000.00 and over.
Your business must have been active and engaged at the time the disaster had commenced, and your business ceased due to destruction in the following areas and during the following periods:
- Beginning on August 23, 2017, for businesses impacted by Hurricane Harvey.
- September 4, 2017, for those businesses who were impacted by Hurricane Irma.
- September 16, 2017, for all businesses impacted by Hurricane Maria
Ending dates would be either once the business had once again become able to resume a significant amount of business or January 1, 2018 (the first occurring date).
See IRS Publication – FAQs for Hurricane Victims – Employee Retention Credit
We hope this information helps those businesses who have been adversely impacted by any kind of disaster, natural or otherwise. We know that many small businesses have had the opportunity to recover and yet many still are attempting to recover, and we do hope to continue to support you in any way possible. We are confident that these IRS publications will help make your tax filing and payment easier. While you are here, take the opportunity to visit the IRS Newsroom for up to date information.
More information about tax planning can be found here.
At Cogent Analytics, we never stop looking for ways to improve your business and neither should you. So, check out some of our other posts for helpful business information: