With the recent destruction Hurricane Harvey has caused to Texas, the IRS will be providing tax relief to those affected by Harvey’s damage. Those impacted that have a filing deadline falling on August 23rd, 2017 through January 31st, 2018 will be granted additional time to file, through January 31st, 2018. The extension includes taxpayers that have a valid extension for their individual or business tax returns, and will give them the ability to file as late as January 31st, 2018. The extension for those affected also includes an extension on quarterly estimates (due on September 15th, 2017 and January 15, 2018) and quarterly payroll and excise tax deposit (due on October 31st, 2017).
The IRS allows for a Taxpayer to use a casualty loss deduction on their tax return in either the year of the loss (2017) or in the prior year (2016). Taxpayers will have the ability to take the deduction for their 2016 federal tax return (with a valid extension or if they amend). If the taxpayer chooses to claim the casualty loss deduction on their 2016 Federal return, they should put “TEXAS, HURRICANE HARVEY” in red ink at the top of their form so the IRS can expedite the processing of their refund.
There are different ways that a Taxpayer can qualify for the relief. Those in a Presidentially-declared disaster area would receive relief (disaster areas can be found on FEMA’s website). For taxpayers whose records are in a disaster area and are needed to file with a deadline will also be entitled to relief. Individuals involved with a recognized government or philanthropic organization assisting in relief activities in the disaster area (declared by FEMA) will be eligible for the extension as well. The IRS automatically identified taxpayers in the disaster area, but if you are affected by the catastrophe but located out of the disaster area, then the taxpayer should call 866-562-5227 to request relief.
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