Tag Archive for FEMA

Colorado Disaster Relief From The IRS – Publication 2194

TaxConnections Blog PostIf you have been impacted by a disaster in your area like many of my friends most recently here in Colorado due to flooding as defined by FEMA and identified by our President causing you to be unable to meet your tax obligations the IRS may be able to assist you with payment and filing extensions, and if qualified, even with an expedited tax refund for casualty losses. President Obama last month declared the counties in Colorado Federal Disaster Areas:  Adams, Arapahoe, Boulder, Clear Creek, Crowley, Denver, El Paso, Fremont, Gilpin, Jefferson, Lake, Larimer, Lincoln, Logan, Morgan, Sedgwick, Washington and Weld.

If you reside or have a business in these counties may qualify for tax relief as the President’s declaration permits the IRS to postpone certain deadlines for taxpayers who reside or have a business in the disaster area.

Specifically you need to know that deadlines falling on or after Sept. 11, and on or before December 2, 2013, have been postponed to December 2, 2013. This includes the quarterly estimated tax payment that was due on September 16. It also includes the due date of September 16 for calendar year corporations and partnerships that received extensions of time to file. Read More

Written by | Posted in Federal • IRS

Disaster Losses Including Casualty And Theft – IRS Publication 547 And Form 4684

If you take one look at FEMA’s website, it’s clear that we are going to see a significant increase in the number of casualty losses going forward. Should you find yourself a victim of a disaster or a casualty or theft loss it is very important that you know what you are entitled to from a tax perspective.

The best resource for this besides the US Tax Code is IRS Publication 547, Casualties, Disasters, and Thefts.  Be sure to review before or as part of preparing IRS Form 4684 when reporting to the IRS. Another good resource of course is the Instructions to the Casualty and Loss Reporting Form 4684.

Most people understand the proper tax treatment of what is often referred to as “standard” casualty and theft losses.

1. calculate the cost basis of the property before the loss

2. determine the decrease in the fair market value of the property as a result of the loss.

3. From the smaller of the two, deduct any insurance or other reimbursement received.

4. Using IRS Form 4684 apply the deduction limits to determine the amount of our deductible loss.

Here is where it starts to get convoluted. Each loss must be reduced by $100. And you further reduce the total of all losses by ten percent of your adjusted gross income.

It’s also important to remember that the loss must be reported the year in which it has occurred.

Before deducting the loss, you must be able to prove that there was a loss. If the loss is from theft for example: Read More

Written by | Posted in Federal • Individual