Technical Information Release  TIR 24-8: Tax Relief for Taxpayers Affected by a Presidentially Declared Disaster

Date:	07/02/2024
Referenced Sources:	Massachusetts General Laws

I. Introduction

On October 10, 2008, the Department of Revenue (“Department”) issued Technical Information Release ("TIR") 08-19: Tax Relief for Taxpayers Affected by a Presidentially Declared Disaster.  TIR 08-19 explained the types of tax relief afforded Massachusetts taxpayers as the result of a declaration by the President of the United States of a disaster area within the United States (“presidentially declared disaster”), as provided in G.L. c. 62C, § 87.  Since the issuance of TIR 08-19, the Department has issued additional TIRs providing tax relief for taxpayers affected by specific natural disasters.[1]  While the law regarding such tax relief has not changed, the Department is issuing this TIR to provide additional detail concerning the tax relief available to Massachusetts taxpayers as the result of a presidentially declared disaster.  This TIR revokes and replaces TIR 08-19.

II. Massachusetts Tax Relief for Presidentially Declared Disasters

A.  Automatic Filing and Payment Extensions for Income and Estate Taxpayers

In general, Massachusetts tax relief afforded as the result of a presidentially declared disaster will follow the relief provided by the Internal Revenue Service (“IRS”), within the limitations of the General Laws, as explained below, unless the Department publicly announces otherwise.  Section 87 of chapter 62C of the General Laws states that such relief may be available for any of the tax actions described in G.L. c. 62C, § 81(a)(1).  The actions listed in § 81(a)(1) include filing returns of income or estate tax and the payment of income or estate tax.  Section 81(a)(1) does not reference filing returns for, or making payments of, the corporate excise, sales and use tax, or any other type of tax.  Thus, for purposes of this TIR, “affected taxpayers” are any personal income or estate taxpayers directly impacted by the disaster, as determined by the IRS and announced in an IRS release, unless the Department publicly announces otherwise. Absent such public announcement, the Department will grant automatic extensions to file returns, submit payments of tax (including payments of estimated tax), and file extension forms only for affected taxpayers, even if the IRS relief extends to other taxpayers.

The due date for income and estate tax returns, payments, and extension filings will be extended for a specified period as announced by the IRS, unless the Department publicly announces otherwise. By statute, the extension shall not be for a period of more than one year.  G.L. c. 62C, § 87.  In the case of extension filings, only the time to file for an extension will be expanded. The extension period will end on the same date it would have ended had the disaster not occurred.  For example, if a taxpayer ordinarily is required to file for a six-month extension by April 15, but may file by May 15 due to a presidentially declared disaster, the period of the extension will still last only until October 15, the date the extension period would have ended absent the disaster.  That is, the period for making the election is extended, but the extension period itself will not be expanded to include an extra month.

During the period of an extension of the filing deadline and payment deadline, no interest or penalties will accrue with respect to income or estate tax returns or payments that have an original or extended due date occurring during the specified period announced by the IRS.[2]  However, a taxpayer that does not file and pay tax by the extended due date will owe interest and penalties dating back to the original tax return or tax payment due date.  The extension will not affect tax deficiencies existing prior to the date the IRS disaster relief begins.  Furthermore, the extension will not apply to claims for refund or abatement, amending returns, making elections, the filing of any other tax documents with the Department, or filings with the Appellate Tax Board or tax appeals filed with Massachusetts courts.

B.  Penalty Waiver for Other Taxpayers

General Laws chapter 62C, section 87 allows for an automatic filing and payment extension only for income and estate taxpayers; however, all taxpayers who fail to file or pay tax timely due to reasonable cause may apply for a waiver of penalties pursuant to G.L. c. 62C, § 33(f) and Administrative Procedure (“AP”) 633.[3]  Therefore, taxpayers other than income and estate taxpayers who are unable to file or pay tax timely due to a presidentially declared disaster may apply for a waiver if their failure results from reasonable cause.  A taxpayer applying for a waiver of penalties due to reasonable cause must establish that care was exercised to the same degree that an ordinary taxpayer in the same position would have exercised such care.  AP 633.II. As AP 633 explains, the Department will presume that reasonable cause exists for at least a portion of a delay of filing or payment if the taxpayer demonstrates that the delay resulted from the destruction of property or records due to a natural disaster.  AP 633.II.A.3.  A taxpayer seeking to apply for a waiver of penalties should do so through MassTaxConnect at https://mtc.dor.state.ma.us/mtc/.  The Department does not have the authority to abate or waive interest.

C.  Claiming Relief

The Department’s computer systems will generally identify income and estate taxpayers located in the covered disaster area and apply automatic filing and payment relief for electronically filed returns.  Any affected taxpayer who files and pays by the extended deadline but nonetheless receives late filing or payment penalties or other charges inconsistent with this TIR should request an abatement electronically through MassTaxConnect.


                                                                        /s/Geoffrey E. Snyder
                                                                        Geoffrey E. Snyder
                                                                        Commissioner of Revenue

GES:RHF:mc

July 2, 2024

TIR 24-8

[1] See, e.g., TIR 10-7: Extension of Time for Certain Tax Filings and Payments for Taxpayers Affected by March 2010 Severe Storms and Flooding; TIR 11-10: Extension of Time for Certain Tax Filings and Payments for Taxpayers Affected by Tropical Storm Irene; and TIR 12-9: Extension of Time for Certain Tax Filings and Payments for Taxpayers Affected [by] Hurricane Sandy.

[2] Interest will continue to accrue when there is only an extension of the filing deadline, but not the payment deadline.  For example, assume that, as the result of a presidentially declared disaster, the IRS postpones filing and payment deadlines from September 15, 2024 to December 15, 2024, so that affected taxpayers will have until December 15, 2024 to file returns and pay any taxes that were originally due during this period.  Taxpayers who had a valid extension to file their 2023 personal income tax returns by October 15, 2024, would now have until December 15, 2024 to file the returns. However, because tax payments related to these 2023 returns were due on April 15, 2024, before the extension period began, those payments are not eligible for the extension.  Interest on unpaid amounts would continue to accrue until they were paid in full, without regard to the extension period.

[3] The reasonable cause standard does not apply to corporate taxpayers that fail to make required estimated tax payments pursuant to G.L. c. 63B, § 2.  Such taxpayers are subject to an addition to tax under G.L. c. 63B, § 3.  See also 830 CMR 63B.2.2(8) (setting forth safe harbors for certain taxpayers seeking relief from the addition to tax).