IRS extends tax filing deadline for taxpayers in Tennessee and Arkansas

ARTICLE | April 14, 2025

Authored by RSM US LLP

Executive summary

IRS postpones various tax filing and tax payment deadlines for storm victims located in Tennessee. Affected taxpayers will have until Nov. 3, 2025, to file returns and pay any taxes that were originally due during this period.

Filing and payment relief for affected taxpayers in Tennessee and Arkansas.

The IRS issued guidance granting relief to taxpayers affected by severe storms, tornadoes, straight-line winds, and flooding in Tennessee and Arkansas that began on April 2, 2025. Taxpayers now have until Nov. 3, 2025, to file various individual and business tax returns and make tax payments. The IRS is offering the relief to those in areas designated by the Federal Emergency Management Agency, currently including Taxpayers residing or having a business in all counties in Tennessee and Arkansas.

The relief postpones various tax filing and payment deadlines that were originally due on or after April 2, 2025, and before Nov. 3, 2025. As a result, affected individuals and businesses will have until Nov. 3, 2025, to file returns and pay any taxes that were originally due during this period. This includes:

• Individual income tax returns and payments normally due on April 15, 2025.
• Quarterly estimated tax payments normally due on April 15, June 16 and Sep. 15, 2025.
• Quarterly payroll and excise tax returns normally due on April 30, July 31 and Oct. 31, 2025.
• Calendar-year corporation and fiduciary returns and payments normally due on April 15, 2025.
• Calendar-year tax-exempt organization returns normally due on May 15, 2025.
• Calendar-year partnerships and S corporations whose 2024 extensions run out on Sep. 15, 2025
• 2024 contributions to IRAs and health savings accounts for eligible taxpayers.

Under section 7508A, the IRS gives affected taxpayers until Nov. 3, 2025, to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns, and trust returns; estate, gift, and generation-skipping transfer tax returns; annual information returns of tax-exempt organizations; and employment and certain excise tax returns), that have either an original or extended due date occurring on or after April 2, 2025, and before Nov. 3, 2025, are granted additional time to file through Nov. 3, 2025.

Penalties on payroll and excise tax deposits due on or after April 2, 2025 and before April 17, 2025 will be abated as long as the deposits are made by April 17, 2025.

The IRS relief includes other time-sensitive actions described in Reg. section 301.7508A-1(c)(1) and Rev. Proc. 2018-58, including filing Form 5500 series returns due on or after April 2, 2025 and before Nov. 3, 2025. The IRS relief also applies to transferors who are not affected taxpayers but who are involved in a section 1031 like-kind exchange pursuant to section 17.02(2) of Rev. Proc. 2018-58.

Unless an act is specifically listed in Rev. Proc. 2018-58, the postponement of time to file and pay does not apply. For example, it does not apply to information returns in the W-2, 1094, 1095, 1097, 1098 or 1099 series; to Forms 1042-S, 3921, 3922 or 8027; or to employment and excise tax deposits.

Disaster-related casualty losses

In addition to extensions of time to file tax returns and complete certain actions, federal disaster declarations offer taxpayers special options with respect to gain/loss recognition. Taxpayers who experience a casualty loss in a federally-declared disaster area may qualify to recognize losses in the year prior to the year the casualty actually occurred under section 165(i). Taxpayers who realize gains by receiving insurance proceeds in excess of basis may be able to defer gain recognition by reinvesting in qualified property under section 1033. Some of these actions are time sensitive, so taxpayers are encouraged to contact their tax advisor to take advantage of the full range of relief options. Taxpayers that will claim a disaster loss should note in bold letters at the top of their return the FEMA disaster declaration number. For the April 2, 2025 severe storms in Tennessee, the designation is 3625-EM. For the April 2, 2025 severe storms in Arkansas, the designation is 3627-EM.

Please see the applicable news release and refer to Publication 547 and Instructions to Form 4684 Casualties and Thefts for instructions.

Automatic penalty relief

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. However, if an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extending filing, payment or deposit due date falling within the postponement period, the taxpayer or their representative should contact the IRS to have the penalty abated.

Relief for those impacted outside the disaster area

The IRS will also work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline occurring during the postponement period are in the affected area. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.

Other relief

Qualified disaster relief payments are generally excluded from gross income. This means that affected taxpayers can exclude from their gross income amounts received from a government agency for reasonable and necessary personal, family, living or funeral expenses, as well as for the repair or rehabilitation of their home, or for the repair or replacement of its contents. Refer to Publication 525 for details.

Additional relief may be available to affected taxpayers who participate in a retirement plan or individual retirement arrangement (IRA). For example, a taxpayer may be eligible to take a special disaster distribution that would not be subject to the additional 10% early distribution tax and allows the taxpayer to spread the income over three years. Taxpayers may also be eligible to make a hardship withdrawal. Each plan or IRA has specific rules and guidance for their participants to follow.