California Wildfire Victims Get Big Break: IRS Extends Tax Deadlines

The Internal Revenue Service (IRS) has granted significant tax relief for thousands of Californians harmed by wildfires.

Wildfires fueled by fierce Santa Ana winds are devouring most of Los Angeles. As of Saturday, there were at least six active blazes in the region.

Thousands of Los Angeles citizens who lost their homes and businesses as a result of the wildfires will benefit from the tax exemption.

Officials believe that more than 12,000 structures have been destroyed in the Los Angeles fires, which have killed 11 people and injured many more.

What To Know

To alleviate some of the financial constraints that victims face, the IRS has extended tax filing and payment deadlines for Los Angeles citizens who own houses or companies in the city until October 15, 2025.

Individual income tax returns due on April 15, 2025, IRA and health savings account contributions, quarterly and estimated taxes due on January 15, 2025, or April 15, June 16, and September 15, 2025, as well as business filings due between March and July, are all covered by the relief.

Furthermore, fines for late payroll and excise tax contributions due between January 7 and January 22, 2025, would be avoided provided the deposits are made before January 22, 2025.

The IRS will automatically give relief to taxpayers with addresses in the affected areas; anyone affected who does not live in the disaster zone but has records there can contact the IRS for assistance. Additionally, taxpayers who suffered uninsured losses as a result of the tragedy can claim them on either their 2024 or 2025 tax returns.

In April 2024, State Farm, one of the state’s largest private insurers, announced that it would cancel 72,000 policies by the summer, including 30,000 residential insurance and 42,000 business unit plans. 1,600 of these were insured homes in Pacific Palisades, an affluent community.

According to the California Department of Forestry and Fire Protection, the Palisades has been one of the most severely damaged places by wildfires, which have destroyed over 21,000 acres and threatened more than 13,000 structures. So far, the Palisades fire is 8 percent contained.

The entire cost of the fires in Los Angeles is anticipated to be between $135 billion and $150 billion, or about 4% of the state’s yearly GDP, AccuWeather reported in a news release on Thursday.