Weeks of record flooding and mountain snows brought on by an “atmospheric river” in California resulted in a federal disaster declaration from the Federal Emergency Management Agency (FEMA). While disaster victims received tax relief from filing and payment deadlines, some were confused after receiving notices from the Internal Revenue Service.
Why are California disaster victims confused?
When taxpayers fail to pay federal tax due by the deadline, the IRS is required by law to generate a Notice CP14 mailout telling recipients they have 21 days to resolve their balance. Some California disaster victims were reportedly confused after receiving the notice, believing they had additional time to file returns and pay any tax due.
(Spoiler: they do.)
While disaster victims did receive Notice CP14, the IRS noted in a recent statement that the mailings also included a special insert reminding these taxpayers that the previously issued tax relief still applies. However, the agency apologized for the confusion, stressing that storm victims who received the Notice do not need to contact the IRS or their trusted tax professional.
How can I learn more about IRS notices and installment arrangements?
DrakeCPE provides courses covering a variety of tax topics, including two that can help tax professionals better serve clients who have received IRS notices or are unable to pay all taxes owed in one lump sum:
For information about available courses, visit DrakeCPE.com.
Source: IRS statement on California mailing of balance due notices
The Tax Place