When a business or individual is hit by a natural disaster such as a flood, storm, or tornado filing or paying taxes becomes a low priority. For this reason, the IRS offers natural disaster tax breaks in the form of extensions so that businesses and individuals living in federal disaster areas can get back on their feet before dealing with their tax issues.
The IRS offers extensions in both filing of returns and paying taxes 2010 due to those that have homes or businesses in areas declared a disaster area by the federal government. This also applies to businesses who have financial records stored in a disaster area, regardless of whether their business is located in the area impacted by the disaster. In these situations late payment penalties are also often times waived.
In some cases, the government will allow you to amend your previous year’s taxes to file a casualty loss, although the disaster is in the current year. This enables the taxpayer to receive their refund, which they are in desperate need of, quicker.
In most cases, the extensions are made available automatically such as in North Carolina, which was given tax extensions until June 30 of this year when their state was declared a disaster area due to tornados and flooding on April 16. Parts of Illinois also received an automatic extension date of June 30 when they experienced flooding and storms.
If you are unsure what is available to you, it is in your best interest to contact the IRS. They do have a disaster line of 866-562-5227 for your help. You will also find resources at www.irs.gov.
IRS Tax Relief For Natural Disaster Area Victims and Businesses by Steve