IRS Storm Relief for Houston: Which Business Deadlines Moved to Feb. 1, 2027?

If your business is based in Harris, Fort Bend, Galveston, Brazoria or another of 62 Texas counties, the IRS has moved many federal deadlines to Feb. 1, 2027. The relief covers returns and payments originally due from July 14, 2026 through January 31, 2027, including extended 2025 business returns and the next two estimated tax payments (IRS). Payroll deposits did not move, and neither did December 31.

The IRS announced the relief on October 27, after the severe storms and flooding that began July 14. Most business owners I talk to have already filed or paid something that is now postponed. The question that matters now is what the extra time can still do for you before February 1.

This is general education, not advice for your specific situation.

Who qualifies for the February 1, 2027 deadline?

The relief applies to individuals who live in the covered area and to businesses, including tax-exempt organizations, whose principal place of business is there (IRS). You don't need to show storm damage. Location is what counts.

In the Houston region, the list includes Harris, Fort Bend, Galveston, Brazoria, Waller, Austin, Colorado, Fayette, Grimes, Matagorda, Washington and Wharton counties (Click2Houston). Montgomery, Chambers and Liberty counties are not on the IRS list.

Because the test applies separately to individuals and businesses, the business and its owner can land on different sides of the line. A company headquartered in Harris County qualifies even if its owner lives in The Woodlands. That owner's personal return generally doesn't qualify, unless the records needed to file it are in the covered area.

The IRS applies the relief automatically based on the address it has on file. If you're outside the area but your records are inside it, call IRS Special Services at 866-562-5227 (IRS).

Which deadlines moved?

For affected taxpayers, these federal deadlines are now February 1, 2027 (IRS):

The IRS also extended to February 1 the time-sensitive actions listed in its standing disaster procedure, Revenue Procedure 2018-58, when they fall inside the window. One of those actions matters to most owners: making retirement plan contributions for the prior year.

What didn't move?

• Payroll and excise tax deposits. Deposits are not postponed. The IRS only abated penalties on deposits due from July 14 through July 28, 2026 that were made by July 29 (IRS). The Form 941 is due later. The money is not.
• 2025 balances due. If you extended your 2025 return, the tax was still due April 15, 2026. That date falls before the relief window, so those payments aren't eligible.
• Information returns. W-2s, 1099s and similar forms are not postponed.
• Texas state taxes. The Comptroller considers state extensions upon request, case by case (Texas Comptroller). Franchise and sales tax deadlines don't move automatically with the federal ones.
• December 31. The relief moves filing and payment dates. It doesn't move the end of the tax year. A payroll bonus, an equipment purchase, a charitable gift or a Roth conversion still has to happen in 2026 to count for 2026.

Can the extra time still help with 2025 retirement contributions?

Possibly, and it's the most valuable piece for many owners. A contribution to a qualified retirement plan, SEP or SIMPLE IRA counts for 2025 if it's made by the business's return due date, including extensions (IRS, Rev. Proc. 2018-58). That act is on the IRS list of postponed actions.

Consider an S corporation in Harris County that extended its 2025 return to September 15, 2026. If the owner didn't fund the full 2025 profit-sharing contribution by then, the postponement may give the company until February 1, 2027 to make it and still deduct it on the 2025 return. The same reasoning can apply to a sole proprietor's SEP contribution tied to an extended 2025 Form 1040.

Two cautions. First, the plan document and your third-party administrator control what can be allocated and when, so confirm with them before you send money. Second, if the 2025 return has already been filed, adding a deduction now means amending it. Under the recently enacted Disaster Related Extension of Deadlines Act, the postponement is treated as an extension when figuring the deadline for refund claims, which gives affected taxpayers more time to claim one (IRS).

If you're still setting owner pay for 2026, the same contribution limits depend on W-2 wages. Our post on how much salary an S corporation owner should take covers that link.

Should you wait until February 1 to pay estimated taxes?

For affected taxpayers, the third- and fourth-quarter 2026 estimated payments can both be made by February 1, 2027 without an estimated tax penalty (IRS). The underlying law also lets the IRS disregard the postponement period when figuring interest on postponed items (26 U.S.C. 7508A).

Waiting can make sense if cash is tight after the storms or if you're using the money for a year-end purchase. Keep in mind:

• It's a deferral, not a reduction. Both payments come due on the same day, just after the holidays.
• Your address on file matters. If the IRS doesn't recognize you as an affected taxpayer, you may get a penalty notice. Call the number on the notice to have it abated.
• Installment agreements are different. Missed payments won't default an agreement during the window, but interest and late-payment penalties keep accruing on those older balances (IRS).

What about casualty losses and retirement withdrawals?

This is where Houston owners should slow down. This relief follows a disaster declaration by the State of Texas. Federal law lets the IRS postpone deadlines for a qualified state-declared disaster when the Governor requests it (26 U.S.C. 7508A). Some other disaster tax rules work differently:

• Personal casualty losses are generally deductible only when the loss is caused by a federally declared disaster (IRS Topic 515).
• Disaster recovery distributions of up to $22,000 from a retirement plan or IRA, which avoid the 10% early-withdrawal penalty, are also tied to a federally declared disaster where you live (IRS).

The federal declaration approved for these storms in September covered FEMA Public Assistance for 19 counties, none of them in the Houston area. The Governor's requests for additional counties and for Individual Assistance were still pending at the time (Office of the Governor). Check the current declaration for your county before you claim a loss or take a penalty-free withdrawal. Grants from a government agency for reasonable personal, living or home repair expenses are generally excluded from income either way (IRS).

What should a Houston business owner do before February 1?

• Confirm the county where you live and where the business has its principal place of business.
• List what's still open: extended 2025 business and personal returns, Q3 and Q4 estimates, Form 941s and any 2025 retirement contributions.
• Ask your administrator whether a 2025 profit-sharing or SEP contribution can still be made and allocated.
• Keep making payroll deposits on the normal schedule.
• Finish 2026 year-end moves by December 31. Our year-end tax planning checklist covers the list.
• Calendar February 1, 2027 for every postponed return and payment, and don't let them all land on your preparer that week.

How can Mercer Street help?

At Mercer Street, we work with business owners on the planning side. We sort out which of your deadlines moved, model whether a late 2025 retirement contribution or a deferred estimated payment makes sense, and document the reasoning for your CPA or tax preparer. We don't prepare tax returns.

Mercer Street's work is billed at $600 per hour with a 2-hour minimum ($1,200). Our services page explains how engagements work.

If you want to use the February 1 window well, schedule a free fit meeting. Fit meetings are virtual, and we can talk through whether a focused review makes sense for you.