UPDATE: Since the original posting, relief has also been extended to the state of Georgia.
The IRS is giving tax relief to those affected by Hurricane Irma (parts of Florida, Puerto Rico, and the U.S. Virgin Islands) that closely resembles the relief that Texas is receiving for Hurricane Harvey. Those impacted, who have a filing deadline falling on September 4th, 2017 through January 31st, 2018, will be granted additional time to file – through January 31st, 2018. This extension includes taxpayers that have a valid extension for their individual or business tax returns, and will allow them to file their returns 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 “FLORIDA, HURRICANE IRMA” in red ink at the top of their form so the IRS can expedite the processing of their refund.
The IRS is also allowing taxpayer’s who are affected and relatives to those affected to take out hardship distributions and loans from their qualified plans to alleviate damages caused by Irma. You can read more about this in our previous alert regarding Hurricane Harvey here.
There are different ways that a Taxpayer can qualify for the relief. Those in a Presidentially-declared disaster area will 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 (again, as declared by FEMA) will be eligible for the extension as well. The IRS automatically identifies taxpayers in the disaster area, but if you are affected by the catastrophe and are located out of the designated disaster area, call 866-562-5227 to request relief.
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