[StBernard] IRS Response to Gustav

[Westley Annis]

IR-2008-100, Sept. 3, 2008

WASHINGTON — The Internal Revenue Service is providing tax relief to victims
of Hurricane Gustav in affected areas of Louisiana .

The IRS is postponing until Jan. 5, 2009 deadlines for taxpayers who reside
or have a business in the disaster area. The postponement applies to return
filing, tax payment and other time-sensitive acts otherwise due between
Sept. 1, 2008 and Jan. 5, 2009. This includes:


·        Individual estimated tax payments due Sept. 15, 2008.

·        Corporate extended 1120 tax returns due Sept. 15, 2008.

·        Individual extended 1040 tax returns due Oct. 15, 2008.

“As residents of Louisiana return to their homes following Hurricane Gustav,
taxes are one thing they won’t need to worry about,” IRS Commissioner Doug
Shulman said. “This relief gives them extra time to get their lives in order
before having to deal with their tax matters.”

In addition, the IRS will waive the failure to deposit penalties for
employment and excise deposits due on or after Sept. 1, 2008 and on or
before Sept. 16, 2008 as long as the deposits are made by Sept. 16, 2008.

Other provisions are listed in the Grant of Relief section below.

Taxpayers who reside in or have a business located in the following parishes
qualify for the relief announced today: Acadia, Allen, Ascension,
Assumption, Avoyelles, Beauregard, Cameron, East Baton Rouge, East
Feliciana, Evangeline, Iberia, Iberville, Jefferson, Jefferson Davis,
Lafayette, Lafourche, Livingston, Orleans, Plaquemines, Pointe Coupee,
Rapides, Sabine, St. Bernard, St. Charles, St. James, St. John the Baptist,
St. Landry, St. Martin, St. Mary, Terrebonne, Vermilion, Vernon, West Baton
Rouge and West Feliciana.

IRS computer systems automatically identify taxpayers located in the covered
disaster area and apply automatic filing and payment relief. Affected
taxpayers who reside or have a business located outside the covered disaster
area must call the IRS disaster hotline at 1-866-562-5227 to request tax
relief. 

If an affected taxpayer receives a penalty notice from the IRS, the taxpayer
should call the telephone number on the notice to have the IRS abate any
interest and any late filing or late payment penalties that would otherwise
apply. Penalties or interest will be abated only for taxpayers who have an
original or extended filing or payment due date between Sept. 1, 2008 and
Jan. 5, 2009.

Covered Disaster Area

The Louisiana parishes listed above constitute a covered disaster area for
purposes of Treas. Reg. § 301.7508A-1(d)(2) and are entitled to the relief
detailed below.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for the postponement
of time to file returns, pay taxes and perform other time-sensitive acts are
those taxpayers listed in Treas. Reg. § 301.7508A-1(d)(1), and include
individuals who live, and businesses whose principal place of business is
located, in the covered disaster area. Taxpayers not in the covered disaster
area, but whose books, records, or tax professionals’ offices are in the
covered disaster area, are also entitled to relief. In addition, all relief
workers affiliated with a recognized government or philanthropic
organization assisting in the relief activities in the covered disaster area
are eligible for relief.

Grant of Relief

Under section 7508A, the IRS gives affected taxpayers until Jan. 5, 2009 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) or to make tax payments,
including estimated tax payments, that have either an original or extended
due date occurring on or after Sept. 1, 2008 and on or before Jan. 5, 2009.

The IRS also gives affected taxpayers until Jan. 5, 2009 to perform other
time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev.
Proc. 2007-56, 2007-34 I.R.B. 388 (August 20, 2007) that are due to be
performed on or after Sept. 1, 2008 and on or before Jan. 5, 2009. This
relief also includes the filing of Form 5500 series returns in the manner
described in section 8 of Rev. Proc. 2007-56. The relief described in
section 17 of Rev. Proc. 2007-56, pertaining to like-kind exchanges of
property, also applies to certain taxpayers who are not otherwise affected
taxpayers and may include acts required to be performed before or after the
period above.

The postponement of time to file and pay does not apply to information
returns in the W-2, 1098 or 1099 series, or to Forms 1042-S or 8027.
Penalties for failure to timely file information returns can be waived under
existing procedures for reasonable cause. Likewise, the postponement does
not apply to employment and excise tax deposits. The IRS, however, will
abate penalties for failure to make timely employment and excise deposits
due on or after Sept. 1, 2008 and on or before Sept. 16, 2008 provided the
taxpayer made these deposits by Sept. 16, 2008.

 

Casualty Losses

Affected taxpayers in a presidentially declared disaster area have the
option of claiming disaster-related casualty losses on their federal income
tax return for either this year or last year. Claiming the loss on an
original or amended return for last year will get the taxpayer an earlier
refund, but waiting to claim the loss on this year’s return could result in
a greater tax saving, depending on other income factors. 

Individuals may deduct personal property losses that are not covered by
insurance or other reimbursements but they must first subtract $100 for each
casualty event and then subtract 10 percent of their adjusted gross income
from their total casualty losses for the year. For details on figuring a
casualty loss deduction, see IRS Publication 547, Casualties, Disasters and
Thefts.

Affected taxpayers claiming the disaster loss on last year’s return should
put the Disaster Designation “Louisiana/Hurricane Gustav” at the top of the
form so that the IRS can expedite the processing of the refund.

Free Return Copies and Transcripts

The IRS will waive the usual fees and expedite requests for copies of
previously filed tax returns for affected taxpayers. Taxpayers should put
the assigned Disaster Designation in red ink at the top of Form 4506,
Request for Copy of Tax Return, or Form 4506-T, Request for Transcript of
Tax Return, as appropriate, and submit it to the IRS.

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.

Taxpayers may download forms and publications from the official IRS Web
site, irs.gov, or order them by calling 1-800-TAX-FORM (1-800-829-3676). The
IRS toll-free number for general tax questions is 1-800-829-1040. 

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