Environmental disasters continue to occur, but previously only federally declared disasters would potentially result in IRS disaster relief. The Filing Relief for Natural Disasters Act (H.R. 517:PL 119-29) “FRNDA”, which became law July 24, 2025, provides additional ways for federal tax deadlines to be postponed following natural disasters. This law ensures faster, broader, and more predictable relief for individuals and businesses impacted by natural disasters, even when the Federal Emergency Management Agency (FEMA) has not issued a federal disaster declaration.
• For disasters occurring prior to July 24, 2025, only federally declared disasters will be considered for IRS relief.
• For disasters occurring on and after July 24, 2025, Governors (or the mayor of D.C.) can now request that the IRS postpone deadlines for disasters recognized at the state level, even if not federally declared.
Under prior law, section 165(h) limited personal casualty loss deductions to federally declared disasters. The OBBBA revises this by allowing deductions for losses stemming from “state-declared disasters,” a term newly defined to include any natural catastrophe that a governor deems severe enough to warrant relief.
While this law provides federal tax relief, states do not automatically conform to federal postponements. Taxpayers must separately verify whether the applicable state tax authority has granted similar filing and payment postponements in response to a disaster.
For taxpayers that operate in disaster-prone regions, this change could offer critical filing relief when it is needed most. Taxpayers are encouraged to contact their tax advisor to discuss relief options if they have been impacted by a natural disaster.
Additional Resources:
Around the nation provides IRS news specific to local areas, primarily disaster relief or tax provisions that affect certain states see https://www.irs.gov/newsroom/around-the-nation for further insights.
If you have been impacted by a natural disaster and want to determine if you qualify for IRS Disaster Tax Relief, please locate your state on IRS’ “Tax relief in disaster situations” at https://www.irs.gov/newsroom/tax-relief-in-disaster-situations.
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