AICPA Voices Strong Support for Cortez-Masto Disaster Tax Relief Bill
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AICPA Voices Strong Support for Cortez-Masto Disaster Tax Relief Bill

1 month ago · 2 min read

Washington, D.C. (September 15, 2021) – The American Institute of CPAs (AICPA) is voicing its strong support for S.2748, the Filing Relief for Natural Disasters Act, introduced by Senator Catherine Cortez Masto (D-NV) today. The bipartisan bill – which is a companion bill to earlier legislation introduced in the House and supported by the AICPA – is sponsored by Senators Chris Van Hollen (D-MD) John Kennedy (R-LA) and includes the following provisions:

  • Extend the Internal Revenue Service’s (IRS) authority to grant tax filing relief following state-declared disasters and states of emergency; and

  • Expand the mandatory federal filing extension from 60 days to 120 days, which provides taxpayers with additional time to file their taxes following a disaster.

The process for receiving tax filing relief from the IRS during a natural disaster can be an arduous one. Relief from the IRS must follow a presidential disaster declaration, which can come days or weeks after a state disaster declaration. The gap places impacted businesses and individual taxpayers in difficult, confusing and stressful situations as they work to rebuild following a natural disaster. This bill would allow the IRS specific authority to quickly postpone certain deadlines in response to state-declared disasters.

“The AICPA has been a vocal advocate for expanded disaster tax filing relief for many years, and we are grateful to Senator Cortez Masto for her leadership on this issue,” said AICPA Vice President of Taxation, Edward Karl, CPA, CGMA. “It’s often difficult for the IRS to act quickly to offer tax relief in the wake of a natural disaster. Senator Cortez Masto recognizes that victims of natural disasters shouldn’t have to worry about tax filing deadlines during an already stressful time and is committed to providing expedited tax filing relief to those taxpayers.”

BACKGROUND:

AICPA Advocacy:

  • In a 2013 letter to Members of Congress, the AICPA requested permanent tax provisions related to disaster relief.

  • In November of 2014, AICPA Tax Executive Committee then-Chair, Troy Lewis, testified before a Senate small business panel, explaining the impact that the current system is having on taxpayers and their advisers.

  • In July of 2015, Representative Tom Reed (R-NY) introduced the National Tax Relief Disaster Act, which incorporated many of AICPA's proposals.

  • In July of 2017, AICPA submitted disaster relief provisions in response to then-Senate Finance Committee Chair Orin Hatch’s (UT-R) request for tax reform comments.

  • In November of 2019, the AICPA commended Rep. Tom Rice (R-SC) in a letter for his continued efforts to provide permanent and consistent tax relief to individuals and businesses affected by natural disasters.

Disaster Facts:

  • Extended due dates for income tax returns (Oct 15) and partnership/s corp returns (Sept 15) typically coincide with the Atlantic hurricane season.

  • From 2016-2020, 11 tropical storms or hurricanes made landfall in the U.S. near tax return filing deadlines in September and October.

  • Currently, the IRS’s authority to grant deadline extensions, outlined in section 7508A, is limited to taxpayers affected by federally declared disasters.


Contact: Veronica Vera
202-434-9215
Veronica.Vera@aicpa-cima.com

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