March 7, 2025

March 7, 2025 Update: As of February 18, 2025, the Los Angeles City Council approved the emergency ordinance that Mayor Karen Bass had requested on January 25. The emergency ordinance is intended to provide relief from Los Angeles business taxes for businesses most impacted by the wildfires. Mayor Bass signed the emergency ordinance, going into full effect on February 26, 2025.

The ordinance eliminates 2025 Los Angeles Business Taxes for the following businesses impacted by the January 2025 wildfires:

• A taxpayer whose business was destroyed by the wildfires starting January 7, 2025 is deemed to have terminated business at the destroyed location on December 31, 2024, and qualifies for tax relief (eliminating the need for Los Angeles business tax renewal for the 2025 tax year)
• A taxpayer whose business was not destroyed, but experienced severe economic disruption for at least 45 days, beginning January 7, 2025 through February 28, 2025, is deemed to have terminated business at the impacted location on December 31, 2024 and qualifies for tax relief

Affected taxpayers need to submit applications by April 14, 2025, to prove either the destruction or severe economic disruption to their businesses. If businesses resume in these locations, businesses will be considered newly established, and be subject to taxation accordingly.

How to Apply for the 2025 Business Tax Relief Program:

• Applications must be submitted online via the Office of Finance portal: https://finance.lacity.gov/
• Applicants will be notified once their request is received, and whether it has been approved

Clarifications:

• Home-based businesses destroyed by fires may qualify for tax relief
• Businesses do not need to be within city boundaries to qualify for tax relief
• Documents that can be provided to demonstrate severe economic disruption can be the following:
  • Images of the property and property map
  • Approved insurance claim
  • Confirmation of debris removal from the US Army Corps of Engineers or their designated contractors
  • Verified clientele list and supporting documentation demonstrating severe economic disruption
  • Client testimonials
• It is strongly recommended that all businesses that apply for the tax relief program also apply for the business tax extension

We will continue to monitor these updates as they progress.

---

Original February 3, 2025 Alert: Los Angeles is taking steps to provide financial relief to businesses impacted by the devastating January wildfires. On January 24, 2025, Los Angeles Mayor Karen Bass issued an Executive Order directing the city’s Office of Finance to draft an ordinance that would waive 2025 business taxes for business most impacted by the fires. This follows a prior announcement made on January 20, 2025 extending the filing deadline for Los Angeles City Business Tax renewals from February 28, 2025 to April 14, 2025 for businesses impacted by the fires.    

What is the Los Angeles Business Tax Renewal?

All businesses registered with the City of Los Angeles must file an annual tax renewal, regardless of whether the business generated income that year. Filing on time ensures businesses avoid penalties and interest while also making them eligible for tax credits and incentives.

Typically, this renewal is due by the last day of February, which would have been February 28, 2025 for this year. However, due to the wildfires, some businesses now have extra time to file.

Who qualifies for the Business Tax Renewal Extension?

To provide relief to businesses impacted by the fires, the city has automatically extended the business tax renewal deadline to April 14, 2025 for businesses located in the following zip codes:

• 90402 (Santa Monica area)
• 90272 (Pacific Palisades)
• 90049 (Brentwood)

Additionally, taxpayers with business locations outside of these zip codes may also qualify for an extension if their business was interrupted as a direct result of the fires. To apply, business owners must submit a written request, along with reasonable proof of the interruption, to the LA Office of Finance before February 28, 2025.

How to Apply:

• Requests can be submitted online via the Office of Finance portal: https://finance.lacity.gov/
• Applicants will be notified once their request is received, and whether it has been approved.

What are the details regarding the proposed Los Angeles Business Gross Receipts Tax Relief?

Under Emergency Executive Order No. 3, the Mayor has directed the Office of Finance to draft an ordinance that, if enacted, would provide relief from the payment of the city's gross receipts for businesses directly impacted by the wildfires.

If adopted, the ordinance would waive payment of Los Angeles Business gross receipts tax for the 2025 tax year (based on 2024 receipts) for businesses within the city of Los Angeles that meet either of the following criteria:

• Destroyed by the wildfires
• Impacted for 60 or more consecutive days due to wildfire-related impacts

As more details emerge about the proposed tax payment relief, we will share updates. 

Have questions or need guidance?

If you have any questions regarding the status of these proposed changes, please contact your HCVT state and local tax partners for assistance.