It’s been a few weeks since Hurricane Matthew scraped most of the east coast, and many taxpayers and businesses are still feeling the effects of the widespread damaged caused by the storm. Thousands still don’t have power, and some areas are continuing to flood and evacuate as the immense amount of rainfall starts to drain towards the coast.
As physical relief efforts continue in eastern North Carolina, the IRS has announced tax relief efforts for residents and businesses most affected by the storm. You or your business might be eligible for an extension on filing your return or making payments. To get a detailed understanding of your potential tax relief options, you should speak with a Raleigh accountant or tax preparation specialist, but in the meanwhile, here are the main points of the Hurricane Matthew tax relief.
Tax Relief Eligible Areas
The tax relief is available to taxpayers who either reside or own businesses located in the covered disaster area, listed under Treas. Reg. § 301.7508A-1(d)(2), and are listed as the following North Carolina counties:
Beaufort, Bladen, Columbus, Cumberland, Edgecombe, Hoke, Lenoir, Nash, Pitt, and Robeson.
You are eligible for the tax relief if you a) reside in one of these counties, b) your business is principally located in one of these counties, c) you are a relief worker providing relief aid to one of the affected counties, or d) you don’t reside or own a business in any of the counties, but your tax records necessary to meet a deadline are in the affected area.
If you are eligible, you do not need to contact the IRS in order to receive this relief. If you receive notice of being late on payments or penalties extended by the relief, contact the IRS via the notice, or bring it to the attention of Raleigh accountant.
Tax Relief for Individuals
So you’ve met the eligibility requirements: what does that mean exactly? Essentially it means that any deadlines or filing requirements due starting October 4, 2016, have automatically been extended to March 15, 2017, so you have more time to prepare your return.
So as an individual resident, if you filed for an extension on your individual return back in April and you are eligible for the relief, your filing deadline has been extended again to March of 2017. If you had payments due after October 4th the payment deadline has also been extended to March. However, if you filed for an extension in April, your tax payments were due in April, and have not been extended to March 2017.
Tax Relief for Businesses
If your business is principally located in the affected North Carolina counties, your business is also eligible for the tax relief, and you should speak with your accountant or tax preparation specialist about your return. All returns and payments due after October 4th, 2016 are now extended until March 15th, 2017.
This extension includes the quarterly estimated tax payments originally due on January 17th. The relief also includes a waiver of late deposit penalties on federal payroll and excise tax deposits that were due between October 4th and October 19th, as long as the deposits themselves are made by October 19th.
Casualty Loss Deduction
If you were lucky during Hurricane Matthew, your losses are minimal. Unfortunately, many North Carolinians have been hit hard by the storm, and are continuing to suffer damages at the hand of the aftereffects.
Hopefully, your insurance will cover any losses you incurred, but if you aren’t covered, that’s okay. If you suffered Hurricane Matthew-related losses that were not covered by your insurance, you could be eligible for a tax break: the Casualty Loss Deduction. This can be claimed the year prior on an amended return, or the year the loss occurred.
Contact Executive Accounting Services
For more information, you can visit the IRS disaster relief page or contact your local Raleigh accountants and tax preparation specialists Executive Accounting Services to ensure you are receiving the tax reliefs you deserve.