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Saltwater seeping into the Mississippi leads to tax relief for some Louisianans

October 1, 2023
Tugboat-barges-Mississippi-River-Vicksburg-Brideg_justin-wilkens-dq3ujEmzV0s-unsplash1

A few years ago, tugboats pushing barges down the Mississippi River, like this one going under the Vicksburg Bridge, was not a problem. Extreme drought, however, has lowered the river's levels, allowing salty water from the Gulf of Mexico to creep upstream below a layer of freshwater. (Photo by Justin Wilkens on Unsplash)

Salt water is creeping up the mouth of the Mississippi River and threatening the drinking supply of several parishes in Southeast Louisiana, including the city and suburbs of New Orleans.

The prospects are so severe, the Federal Emergency Management Agency (FEMA) declared major disasters in Jefferson, Orleans, Plaquemines, and St. Bernard parishes. The Internal Revenue Service followed with an announcement of tax relief for individuals and businesses in those locations.

Lots of Feb. 15, 2024, deadlines: These taxpayers now have until Feb. 15, 2024, to file various federal individual and business tax returns and make tax payments.

Affected Louisianans now join taxpayers in six other states who now have until next February to take care of some tax tasks. In addition to Pelican State residents dealing with the saltwater intrusion disaster, the Feb. 15, 2024, deadline applies to —

This collection of disasters and subsequent postponed tax deadline of Feb. 15, 2024, earns the date designation as this weekend's By the Numbers figure.

Many locales, same general relief: The Louisiana disaster tax relief follows the same general paraments as the earlier mid-February tax payment and filing due date extensions.

The new Feb. 15, 2024, deadline is for taxpayers who got the usual extension (by filing IRS Form 4868) earlier this year to file by Oct. 16, 2023.

Remember, though, that when the extension request was made, either on or before April 18, taxpayers should have paid any tax due. If they didn't, penalty and interest charges have been accruing. The disaster announcement does not change this.

In addition, the newly-added Louisiana taxpayers who pay estimated taxes now get more time to submit their final tax year 2023 installment, normally due on Jan. 16, 2024. That's pushed to Feb. 15, 2024.

Calendar-year corporations whose 2022 extensions run out on Oct. 16 also qualify for the Feb. 15, 2024, filing postponement deadline. Penalties on payroll and excise tax deposits due on or after Sept. 20, 2023, and before Oct. 5, 2023, will be abated as long as the tax deposits are made by Oct. 5, 2023.

Claiming a disaster tax deduction: Finally, for what seems like the gazillionth time this year, the IRS (and the ol' blog) remind disaster area taxpayers that they may be able to claim any uninsured losses as a tax deduction.

You also get to decide on the tax year you use to make the claims.

You can find more about disaster claim filings in my post Considerations in making a major disaster tax claim. The IRS has more about this claim filing option in Publication 547, as well as on the agency's Disaster Assistance and Emergency Relief for Individuals and Businesses online page.

Whenever you file any tax document that's in connection with a major disaster, you should put the assigned FEMA declaration number on the documents. This will alert the IRS to give it expedited attention.

For Louisiana saltwater intrusion filings, that's FEMA declaration EM-3600-LA.

Louisiana saltwater intrusion FEMA disaster EM3600

If FEMA adds more parishes to this disaster area, individuals and businesses in those areas will get the same tax relief. You can keep up with any disaster and tax updates here at the ol' blog, by staying in touch with your tax advisor, and/or periodically checking FEMA's online declarations and IRS.gov's special tax relief in disaster situations page.

Finally, you can get more on the Mississippi's saltwater troubles in these articles from The Hill and FoxWeather.

You also might find these disaster tax items of interest:

 

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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