As many continue to assess the damages from recent hurricanes, the IRS has expanded the federally declared disaster areas to cover additional counties. Some of the counties now include areas of San Antonio, Austin, Houston, Dallas, and Ft. Worth. This means individuals and businesses could have additional time granted to them for filing various returns. Additional information and tax considerations following the hurricane disasters can be found here.
In addition, President Trump signed into law the Disaster Tax Relief and Airport and Airway Extension Act of 2017. Under this act, taxpayers in the affected areas can receive tax assistance for various items. Assistance under the act includes the following:
- Elimination of the current requirement that an uncompensated personal casualty loss exceed 10 percent of adjusted gross income in order to qualify for the deduction.
- Elimination that a taxpayer must itemized to obtain casualty loss relief.
- Individuals can take a loan up to a threshold from their retirement plan for disaster relief.
- Individuals are exempt from the 10 percent penalty on early withdrawal from their retirement plan if their distributions are qualified hurricane relief distributions.
- Charitable contributions for relief efforts are not subject to income limitations. These donations must be made August 23, 2017 and December 31, 2017.
- Eligible employers can take a tax credit up to 40 percent of wages (up to $6,000 per employee) paid by a disaster-affected employer to a qualified employee in the core disaster area.
While these tax relief efforts are much needed for our state and our country, they certainly bring with them their share of complexity. ATKG’s team stands ready to help you with the process. Please contact us at 210.733.6611 or at firstname.lastname@example.org to let us know how we can provide assistance.
By: Diane White, CPAby