Texas Society of CPAs Announces Federal Tax Relief for Those Affected by Wildfires

After President Obama declared the areas of Bastrop County and parts of the Texas Hill Country a federal disaster area, The Texas Society of CPAs (TSCPA) received word from the IRS North Texas governmental liaison and FEMA Region VI that certain taxpayer deadlines will be postponed for those who live in or have businesses in the disaster area.

“The extension and waiver of penalty creates an opportunity for those affected to focus on what’s most important, and that is to take care of their families without worrying about additional punitive assessments from the IRS,” said Sean Duncan, CPA, a member of the TSCPA and president of SMD Consulting & Accounting, LLC. “While the taxpayer still has the obligation to make sure their returns are filed and/or their payments are made, this extension provides them with more time to do that while juggling their various responsibilities.”

Deadlines falling on or after Aug. 30 and on or before Oct. 31 have been postponed until Oct. 31., including:

• Corporations and business that previously obtained an extension until Sept. 15 to file 2010 returns.
• Individuals and business that received a similar extension until Oct. 17.
• The estimated tax payment for the third quarter, normally due Sept. 15.

The IRS will also waive failure-to-deposit penalties for employment and excise tax deposits due on or after Aug. 30 and on or before Sept. 14, 2011, provided the deposits were made by Sept. 14, 2011.

“Anyone living in the affected areas should make it a point to speak with a CPA to determine how to best treat the casualty loss they have incurred,” said Duncan. “There is a real tax planning opportunity surrounding this disaster.  While a tax deduction will never replace what has been lost, the taxpayer would be doing themselves a disservice to overlook the relief that is being made available to them.”

Taxpayers in the disaster area will be automatically identified by the IRS and filing and payment relief will be applied accordingly. Taxpayers who live or have businesses outside the covered disaster area must call the IRS disaster hotline at (866)562-5227 to request tax relief.