Filing extension or calling to register for FEMA due date

Technical topics regarding tax preparation.
#1
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I understand if a taxpayer is NOT in FEMA area but he hires a tax professional who is in FEMA area to prepare his 2022 tax return, he will get the special FEMA Disaster extended due date until October too. But in that case, the tax professional will have to call IRS to register this taxpayer for the extended due date. I am thinking instead of doing that, why don't we just file an extension for this taxpayer, which will be much easier than calling the IRS and holding for an agent.

So is there a difference between registering for the extended due date or just simply filing an extension in this situation?
 

#2
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MeaningfulIdea wrote:So is there a difference between registering for the extended due date or just simply filing an extension in this situation?

Yes, there is. Filing for an extension only extends the filing deadline, not the payment deadline or interest. Relying on the postponed due date for the California counties that are in the disaster area applies to the filing deadline, the payment deadline, and also postpones the accrual of interest.
 

#3
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Thank you. That makes sense.

One more question. Some of my clients told me a rumor that everyone needs to register with the IRS in order to get the FEMA due date no matter where the taxpayer live. But I think that is not true because taxpayers reside in FEMA disaster counties are not required to register and will get the extended due date by default. Am I correct?
 

#4
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MeaningfulIdea wrote:One more question. Some of my clients told me a rumor that everyone needs to register with the IRS in order to get the FEMA due date no matter where the taxpayer live. But I think that is not true because taxpayers reside in FEMA disaster counties are not required to register and will get the extended due date by default. Am I correct?

You are correct. Here's what the IRS says (from CA-2023-03):
Taxpayers considered to be affected taxpayers eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts are those taxpayers listed in Treas. Reg. § 301.7508A-1(d)(1), and include individuals who live, and businesses (including tax-exempt organizations) whose principal place of business is located, in the covered disaster area.

https://www.irs.gov/newsroom/irs-provides-tax-relief-for-victims-of-severe-winter-storms-flooding-landslides-and-mudslides-in-california
 

#5
Wiles  
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Can a taxpayer living outside with a tax preparer inside make this request after 4/18/23?
 

#6
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Wiles wrote:Can a taxpayer living outside with a tax preparer inside make this request after 4/18/23?

I suppose so, but it's not advisable because what if the IRS turns down the request? See Q1 on this IRS page:

https://www.irs.gov/businesses/small-businesses-self-employed/faqs-for-disaster-victims#affectedtaxpayersandrecords

Note that the preparer must be "unable to file or pay on your behalf." This seems to be a higher requirement than just residing in or having a business in one of the listed counties.
 

#7
Wiles  
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I am definitely not able to pay on their behalf.
 

#8
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I don't think that's what it means.
 

#9
Wiles  
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:)

In that case, since their tax return is not done, then I can safely say that I am not able to file on their behalf.
 

#10
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I don't think it means that either. The answer is poorly worded ---

Disaster relief applies to the clients of tax preparers who are unable to file returns or make payments on behalf of the client because of a federally declared disaster.

I read this as meaning that the client is unable to file the return or make payments because the preparer has been affected by the disaster.
 

#11
Wiles  
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Yes. I agree. If they intended to raise the bar higher than simply having a preparer inside the disaster zone, then they did a very poor job saying so.
 


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