The American Institute of CPAs has expressed its strong support of H.R. 8007, the Disaster Tax Lookback Parity Act of 2024, in a letter to Representatives George Murphy (R-NC) and Jimmy Panetta (D-CA), who are original sponsors of the bill. Taxpayers impacted by disasters typically do not have the benefit of the lookback period for claiming credits and refunds being aligned with a postponed return filing due date, which this legislation would provide for all federally declared disasters.

The legislation provides relief similar to recommendations previously submitted to Congress by the AICPA, as well as recommendations outlined in the National Taxpayer Advocate’s recent Annual Report to Congress requesting a modification of the lookback period for allowing tax credits or refunds.

When taxpayers are affected by a major disaster such as a wildfire, flood, earthquake, or hurricane, the Internal Revenue Service (IRS) often provides relief in the form of extended filing and payment deadlines. However, this relief typically does not extend the cutoff for refund or credit claims, which is still based on the original filing deadline. As a result, under current law, taxpayers affected by a major disaster often have less time to make a refund or credit claim than those who are not affected.