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Tax Relief After Hurricane Harvey

icon hurricane harveyWe hope you and your family are safe. As most of us who call the Houston area home were impacted by Hurricane Harvey, please note that you may qualify for tax relief from the IRS due to the disaster declaration for our area. Here is a summary of the tax relief items provided by the IRS:

• Under section 7508A, the IRS gives affected taxpayers until January 31, 2018, to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns, and trust returns; estate, gift, and generation-skipping transfer tax returns; and employment and certain excise tax returns).

• Affected taxpayers that have an estimated income tax payment originally due on or after August 23, 2017 and before January 31, 2018, will not be subject to penalties for failure to pay estimated tax installments if such payments are paid on or before January 31, 2018. This relief also includes the filing of Form 5500 series returns, (that were required to be filed on or after August 23, 2017, and before January 31, 2018.

Casualty Losses

• Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either the year in which the event occurred, or the prior year. Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. Affected taxpayers claiming the disaster loss on a 2016 return should put the Disaster Designation, “Texas, Hurricane Harvey” at the top of the form so that the IRS can expedite the processing of the refund.

Other Relief

• 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to victims of Hurricane Harvey and members of their families.

• The IRS will waive the usual fees and expedite requests for copies of previously filed tax returns for affected taxpayers.

• Affected taxpayers who are contacted by the IRS on a collection or examination matter should explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case.

Please visit: https://www.irs.gov/newsroom/help-for-victims-of-hurricane-harvey for more details regarding these tax relief items.

Please let us know if you have any questions or if we can further assist you.

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