All along the Mississippi and Louisiana Gulf Coast people are trying to put their lives back together after Hurricanes Katrina and Rita. Almost five months after Katrina tore through the Gulf States, these residents are focused on cleaning up their homes, rebuilding, and in some instances, simply finding a place to live. The last thing any of these people wants to think about now is TAX TIME. But, where man is appointed to die only once, the tax man shows up annually whether you are ready or not. But, all is not gloom and doom this year in the realm of taxation for persons living in the affected areas of the storms. The Internal Revenue Service and the U.S. Department of the Treasury have issued a number of tax provisions following the disaster declarations by President Bush along the Gulf Coast. The following is an explanation of just some of the many provisions to help this year. Extended Income Tax Filing and Payment Deadlines Taxpayers in the affected areas will have until February 28, 2006, to file any income, estate, gift, excise, or payroll tax returns with due dates on or after August 29, 2005. In addition, any penalties or interest for late filings of payroll or income tax to the IRS which were due in this date range, will be removed. Tax Relief for Housing Dislocated Persons A special deduction has been created for individuals who opened their homes and their hearts to provide rent-free housing to storm victims for at least 60 days. The deduction can be claimed either on you 2005 or 2006 Federal Tax Return. The deduction is $500 for each dislocated person housed in the taxpayers principal residence. The deduction is limited to $2,000 combined for both 2005 and 2006. You must have the storm victim's social security number. The dislocated person can be a relative. So Grandma and Grandpa that kept the kids and grandkids can get more benefit that just the fun of having their loved ones close. Louisiana Only Storm victims in Louisiana who report the casualty loss for their damage on their Federal Returns, will not have their State Tax deduction for Federal taxes paid reduced. Taxpayers will need to calculate their Federal Tax Returns with the losses and without to determine the deduction on the State Return. As I said, these are just a few of the many provisions. So, please make sure if you use a payroll tax service such as ADP, that you contact them to ensure that they have taken the adjusted due date into account in regards to your tax deposits. Also, you need to make sure that all paid tax preparers are notified that you reside in an affected area to guarantee that they take this into account when filing forms and making payments. And, finally, may God Bless You and keep you safe. Taxes are one thing. But, the safety of our loved ones and friends is always most important. |
