IRS Issues Tax Relief for Millions

The Internal Revenue Service (IRS) will provide tax relief to those impacted by severe storms in California’s San Diego County last month, when the area saw the highest 24-hour rainfall amounts since the 1850s, according to the National Weather Service (NWS).

The IRS will offer tax relief to individuals and businesses in parts of the Golden State affected by the storms and flooding that began on January 21, according to an announcement made on Tuesday. It’s offering relief to any area designated by the Federal Emergency Management Agency (FEMA), which currently includes San Diego County only. It has a population of more than 3 million people.

San Diego County was battered by five days of heavy rain and accumulating mountain snow, which caused widespread flooding in the area. January 22 was among the wettest days on record in the county, according to the NWS, which reported 2.73 inches of rain in 24 hours.

According to FEMA, a single inch of rainwater can cause $25,000 in damage to a home. In late January, the county estimated $90 million in damages across the region and $4.1 million for the county itself, as reported by NBC 7 San Diego.

The storms and flooding killed three people and caused damage to residents’ properties including cars and homes, leading city and county authorities, as well as Governor Gavin Newsom, to declare states of emergency.

On February 19, Newsom announced that the White House had approved his request for a presidential major disaster declaration in San Diego, which allowed for the release of federal funding to help state and local authorities in California with the recovery efforts in the county.

This aid is available in the form of “temporary housing and home repairs, low-cost loans to cover uninsured property losses, and other programs to help individuals and business owners recover from the effects of the disaster,” Newsom wrote in a statement.

Previous Newsweek reporting revealed that millions of American homeowners aren’t getting flood insurance despite the increase in frequency and severity of such events, even in areas not traditionally exposed.

Standard home insurance in California doesn’t cover losses due to flood damage, and flood insurance isn’t required for any federally backed mortgage in the state.

The latest numbers from the National Flood Insurance Program (NFIP), a part of FEMA that covers flood damage, show only 52,820 homes and businesses in the eight Southern California counties where a state of emergency was proclaimed last month were covered by flood insurance, as reported by the Los Angeles Times. These included Los Angeles, Orange, Riverside, San Bernardino, San Diego, San Luis Obispo, Santa Barbara and Ventura counties.

The NFIP policy has a limit of covering only $250,000 in damage to the building and $100,000 to personal property inside the home.

Taxpayers in San Diego County have until June 17 to file “various federal individual and business tax returns and make tax payments,” the IRS wrote.

Newsweek contacted the IRS and Newsom for comment by email on Wednesday morning.

There’s the possibility that more Californians affected by the January storms will become eligible for tax relief in the future if their places of residence or business are later added to the disaster area. The list can be viewed on the IRS website.