This act ensures that tax deadlines postponed due to disasters are also applied when calculating the time limits for claiming tax credits or refunds and for tax collection notices.
Gregory Murphy
Representative
NC-3
The Disaster Related Extension of Deadlines Act ensures that tax deadlines postponed by the IRS due to major disasters, fires, or acts of war are also applied to the time limits for claiming tax credits or refunds. This legislation also mandates that the IRS must adjust collection notice deadlines to account for these disaster-related extensions. Essentially, it provides taxpayers with the same amount of extra time for refunds and payment obligations as they receive for filing.
| Party | Total Votes | Yes | No | Did Not Vote |
|---|---|---|---|---|
Republican | 218 | 212 | 0 | 6 |
Democrat | 213 | 211 | 0 | 2 |
New Act Protects Tax Refunds and Credits for Disaster Victims by Extending IRS Deadlines
If you’ve ever had to deal with the IRS during a crisis, you know the paperwork doesn’t stop just because your life has been turned upside down. The Disaster Related Extension of Deadlines Act is a short, technical bill that fixes a common-sense oversight in the tax code, offering real relief when people need it most.
The Fine Print That Matters When Disaster Strikes
This bill clarifies how the Internal Revenue Service (IRS) handles deadlines when a major disaster, like a hurricane, wildfire, or even an act of terrorism, forces them to postpone the tax filing date. Currently, the IRS has the authority (under Section 7508A) to push back the deadline for filing your taxes if you’re in a federally declared disaster area. However, there was a confusing disconnect: while they extended the time you had to file your return, the clock kept ticking on the time you had to claim a refund or credit you were owed.
This new Act fixes that. It states that if the IRS extends your filing deadline due to an emergency, that exact same extension period must now be applied to the statutory time limit you have to claim a tax credit or refund (Section 6511(b)(2)(A)).
Protecting Your Money When You’re Rebuilding
Think about a family whose home was destroyed in a wildfire. They’re dealing with insurance, temporary housing, and starting over. The IRS might give them an extra six months to file their return. Without this change, if they realized three months into that extension that they missed a deadline to claim a refundable tax credit from the previous year, they could lose that money—even though they were still within the IRS’s declared disaster extension period. This bill ensures that the disaster extension actually protects their right to claim money back from the government, providing crucial financial stability during recovery.
Clarity on Collection Notices
The Act also addresses the flip side: tax collection. It requires the IRS to adjust the deadlines on any tax collection notices they send out (Section 6303(b)) to account for any time that was postponed because of the disaster. This means that if you owe the IRS money, they can't restart the clock on demanding payment until the disaster-related grace period is truly over. This prevents the added stress of receiving an urgent collection demand while you are still dealing with the immediate aftermath of an emergency.
Essentially, this legislation aligns the IRS’s internal timelines, making sure that when they grant a disaster extension, they grant it completely—both for your obligation to pay and your right to receive money. It’s a procedural fix, but one that offers significant peace of mind and protection for anyone navigating the complex world of taxes while recovering from a crisis.