United States

IRS provides relief for victims of severe storms in West Virginia

TAX ALERT  | 

On Aug. 22, 2017, the IRS issued News Release WV-2017-02 (WV-2017-02), directed towards taxpayers affected by severe storms, flooding, landslides, and mudslides in parts of West Virginia. According to WV-2017-02, taxpayers who reside in or have a business in designated counties in West Virginia have until Nov. 30, 2017 to file certain tax returns and make certain tax payments otherwise due on or after July 28, 2017, but before Nov. 30, 2017. As of Aug. 22, 2017, designated counties in West Virginia include Harrison, Marion, Marshall, and Wetzel.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for postponement of time to file, pay taxes, and perform other time-sensitive acts are those taxpayers listed under the definition of affected taxpayer in Reg. section 301.7508A-1(d)(1), and include individuals who live, or whose principal place of business is located in a designated county. Taxpayers eligible for relief also include those taxpayers  whose records, necessary to meet a deadline listed in Reg. section 301.7508A-1(c), are located in a designated county. Lastly, all relief workers affiliated with a recognized government or philanthropic organizations assisting in the relief activities in a designated county and any individuals visiting a designated county area who were killed or injured as a result of the disaster are also entitled to relief.

Grant of Relief

Pursuant to section 7508A, which gives the IRS authority to postpone deadlines by reason of presidentially declared disaster actions, the IRS extended the due date for affected taxpayers until Nov. 30, 2017, 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), that have either an original or extended due date on or after July 28, 2017, and before Nov. 30, 2017.

Affected taxpayers that have an estimated income tax payment originally due on or after July 28, 2017, and before Nov. 30, 2017, will not be subject to penalties for failure to pay estimated tax installments as long as such payments are paid on or before Nov. 30, 2017. The IRS also gives affected taxpayers until Nov. 30, 2017, to perform other time sensitive actions described in Reg. section 301.7508A-1(c)(1) and Rev. Proc. 2007-56 that are due to be performed on or after July 28, 2017, and before Nov. 30, 2017.

This relief also includes the filing of Form 5500 series returns, which were required to be filed on or after July 28, 2017, and before Nov. 30, 2017, 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, also applies to certain taxpayers who are not otherwise affected and may include acts required to be performed before or after the period above.   

Casualty Losses

Affected taxpayers in a designated county have the option of claiming disaster-related casualty losses on their federal income tax return for either the year in which the disaster occurred or the prior year. Affected taxpayers claiming the disaster loss on a 2016 return should put the Disaster Designation “West Virginia Severe Storms, Flooding, Landslides, and Mudslides” at the top of the return so that the IRS can expedite processing the refund. See Publication 547 for details.

In addition, individuals may deduct personal property losses that are not covered by insurance or other reimbursements. See Form 4684 and its instructions for details.

Other Relief

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

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