Hurricane Dennis came ashore over the weekend, leaving behind a path of destruction that has yet to be assessed. Fortunately, special tax law provisions may help taxpayers recover financially from such major disasters.
President Bush has already declared some of the areas most damaged by Dennis Presidential Disaster Areas. Presidential Disaster Areas are not common but neither are they rare; parts of Pennsylvania, New York and New Jersey were designated presidential disaster areas in April after severe storms and flooding swept through the region..
Since Dennis followed the general path taken by Hurricane Ivan last year, the tax relief provided then may offer hints about what taxpayers might expect this year including the waiving of penalties on late employment and excise tax deposits and extending deadlines for tax payments and returns.
The Internal Revenue Service (IRS) offers an overview of tax-relief for presidentially-declared disaster areas in Topic 515, Casualty, Disaster and Theft Losses. In addition, information about state-specific tax relief information is also available on the IRS web site.