October 16, 2024

Recently, the IRS issued tax relief that can extend/postpone the 45-day and 180-day deadlines applicable to ongoing Section 1031 exchanges for Hurricane Helene (multiple states and Notices) and for Hurricane Milton in Florida (FL 2024-10). Each Relief Notice provides universal tax relief that extends the deadline to file various individual and business tax returns and to make tax payments for affected taxpayers. Updated Notices can be found on the IRS website.

For background regarding this tax relief and additional considerations, please review the linked IRS disaster guidance. Due to the widespread damage from Hurricane Helene, the IRS published a detailed bulletin (IR 2024-266)  regarding the universal resources available to those impacted by the storm.

An affected taxpayer transacting a 1031 exchange has two potential extension options pursuant to an IRS Relief Notice. Dependent on when the exchange commenced, they could qualify for one or both options explained in our disaster page linked here. “General Relief” is typically a fixed extended deadline pursuant to an IRS Notice.  Section 17 Relief under Revenue Procedure 2018-58 is a more fact specific scenario and involves calculating an extended deadline by adding 120-days to an eligible exchange deadline. The below summaries focus on General Relief.

FLORIDA (FL-2024-10) Hurricane Milton:

Notice FL 2024-10, posted October 11, 2024. Relief for individuals and businesses in 51 specified counties affected by Hurricane Milton that began on October 5, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

** The Hurricane Milton relief Notice provides further relief for “affected taxpayers” with deadlines already under extension prior to being affected by Milton. i.e. deadlines already under extension until Feb 3, 2025, due to Hurricane Debby.

FLORIDA (FL-2024-08) Hurricane Helene:

Notice FL-2024-08, posted Oct. 1, 2024. Relief for individuals and businesses in 40 specified counties affected by Hurricane Helene that began on September 23, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

** The Hurricane Helene relief Notice provides further relief for “affected taxpayers” with deadlines already under extension prior to being affected by Helene. i.e. deadlines already under extension until Feb 3, 2025, due to Hurricane Debby.

From Notice FL-2024-08 Hurricane Helene:

“Updated 10/3/2024: This news release has been updated for clarification purposes. Tax deadlines remain Feb. 3, 2025, for areas of the state that received Debby-related relief, but not Helene-related relief. Currently, this includes the following 20 counties: Baker, Brevard, Clay, DeSoto, Duval, Flagler, Glades, Hardee, Hendry, Highlands, Lake, Nassau, Okeechobee, Orange, Osceola, Polk, Putnam, Seminole, St. Johns and Volusia. For further details, see below.”

*Because of the wide impact of these storms, tax deadlines for most Florida residents could be extended to May 1, 2025. Because the affected areas vary for each of the three major storms (Debby, Helene, Milton), we strongly recommend confirming eligibility with a tax advisor.

Hurricane Helene – Multiple States

SOUTH CAROLINA (SC-2024-08) Hurricane Helene:

Notice posted October 1, 2024. Relief for individuals and businesses in the entire state of South Carolina that were affectedby Hurricane Helene that began on September 25, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

“Affected Taxpayers with returns and payments with due dates postponed until Feb. 3, 2025, due to Hurricane Debby in South Carolina (SC-2024-07) will also now have until May 1, 2025, to file and/or pay.”

NORTH CAROLINA (NC-2024-08) Hurricane Helene:

Notice posted October 1, 2024. Relief for individuals and businesses in the entire state of North Carolina that were affectedby Hurricane Helene that began on September 25, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

“Affected taxpayers with returns and payments with due dates postponed until Feb. 3, 2025, due to Tropical Storm Debby in North Carolina (NC-2024-07) will also now have until May 1, 2025, to file and/or pay.”

GEORGIA (GA-2024-08) Hurricane Helene:

Notice posted October 1, 2024. Relief for individuals and businesses in the entire state of Georgia that were affected by Hurricane Helene that began on September 24, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

“Affected taxpayers with returns and payments with due dates postponed until Feb. 3, 2025, due to Hurricane Debby in Georgia (GA-2024-07) will also now have until May 1, 2025, to file and/or pay.”

ALABAMA (AL-2024-05) Hurricane Helene:

Notice posted October 1, 2024. Relief for individuals and businesses in the entire state of Alabama that were affected by Hurricane Helene that began on September 22, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

VIRGINIA (VA-2024-01) Post-tropical Cyclone Helene:

Notice posted October 1, 2024. Relief for individuals and businesses in the entire state of Virginia that were affected by Cyclone Helene that began on September 25, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

TENNESSEE (TN-2024-01) Tropical Storm Helene:

Notice posted October 1, 2024. Relief for individuals and businesses in the entire state of Tennessee that were affected by Tropical Storm Helene that began on September 26, 2024. Affected taxpayers now have until May 1, 2025, to file various federal individual and business tax returns. To learn more about the relief and specific areas affected, see the IRS website here.

Extended Relief under Rev. Proc. 2018-58

In addition to any applicable General Relief, affected taxpayers and impacted exchangers who started their exchange on or before the disaster date qualify for extended relief pursuant to Rev. Proc. 2018-58, Section 17.

“Impacted 1031 Exchangers” – It is important to note that under Rev. Proc. 2018-58, Section 17, expanded relief is available for qualifying taxpayers transacting a 1031 exchange who are domiciled outside of the disaster area. Impacted 1031 Exchangers can qualify for relief based on a variety of reasons, as explained in Section 17. Our website features an extension calculator for those who qualify for Section 17 Relief.

**Eligibility for disaster extensions could vary on a case-by-case basis and the Covered Disaster Areas specified in IRS guidance are often updated over time. Exchangers and their advisors should carefully review any IRS guidance regarding disaster relief and make any determinations accordingly. When considering the impact of these disasters, it is important to determine if you or one of your clients is an affected taxpayer or otherwise eligible for tax relief, even if located far from the disaster area. If so, you should promptly contact your 1031 qualified intermediary.

If you are a current client, your tax advisor believes that you are eligible for this relief, and you have decided to apply it to your exchange, please contact our office at 877-701-1031, ext. 1, to notify us and discuss.