JUNE 29 DEADLINE NEARS FOR PUERTO RICO HURRICANE VICTIMS:

NSTPDeadline, Uncategorized

Residents of Puerto Rico, the U.S. Virgin Islands and American Samoa affected by last year’s hurricanes and tropical storms who are required to file a 2017 federal income tax return or pay their 2017 tax, must do so by June 29. This special extended deadline is available regardless of whether a taxpayer’s residence changed during 2017. No interest, late-filing penalty or late-payment penalty will be due. Further, bona fide residents of Puerto Rico, the U.S. Virgin Islands and American Samoa, who permanently relocated to the U.S. mainland due to last year’s hurricanes and tropical storms may need to file Form 8898, Statement for Individuals Who Begin or End Bona Fide Residence in a U.S. Possession, with the Internal Revenue Service along with their Form 1040 or Form 1040NR. Due to the disaster-related extensions granted by the IRS to residents of these three U.S. territories, Form 8898 will generally be due by Friday, June 29, 2018. In addition, anyone who files for an income-tax-filing extension will also have until October 15, 2018, to file Form 8898. This requirement to file Form 8898 applies to anyone who had total gross income exceeding $75,000 for the year, ceased to be, or became, a … Read More

TAX FILING DEADLINE POSTPONED UNTIL JUNE 29 FOR VICTIMS OF HURRICANE MARIA IN PUERTO RICO AND THE VIRGIN ISLANDS

NSTPInternal Revenue Service (IRS)

The IRS has extended tax deadlines for affected individuals and businesses until June 29, 2018, for the following localities: In the U.S. Virgin Islands (starting Sept. 16, 2017): Islands of St. Croix, St. John and St. Thomas. In Puerto Rico (starting Sept. 17, 2017): In any of the 78 municipalities. The disaster relief page on the IRS website has details on the returns, payments and tax-related actions qualifying for the additional time. Following the IRS extension, affected individuals and businesses will have until June 29, 2018, to file their 2017 tax returns and pay any taxes due on those returns. This relief also includes individual estimated tax payments, payroll and excise tax returns, corporate income tax returns originally due or on extension during the relief period and tax-exempt organizations required to file Form 990 series returns with an original deadline falling during this period. This relief also applies to taxpayers who had a valid extension to file their 2016 return that was due to run out on October 16, 2017, and which was already postponed until January 31, 2018. The IRS will abate any interest, late-payment or late-filing penalty that would otherwise apply for 2017 tax returns. The IRS automatically … Read More

IRS REMINDS HURRICANE VICTIMS OF SPECIAL EITC OPTION FOR 2017: IR 2018-10

NSTPInternal Revenue Service (IRS)

In a news release, IRS has reminded hurricane victims of a special computation method allowing them to use either current or prior year’s income for purposes of claiming the earned income tax credit (EITC). To qualify for EITC, an eligible taxpayer must meet basic rules and have earned income from an employer or be self-employed (either running a business or farm). This includes home-based businesses, the sharing economy and employment in the service, construction and agriculture industries. In addition, certain disability payments may qualify as earned income for EITC purposes. The EITC Assistant, available on IRS.gov, can help taxpayers determine eligibility and estimate the amount of their credit. Hurricane relief. Following the devastation of Hurricanes Harvey, Irma, and Maria, Congress passed the “Disaster Tax Relief and Airway Extension Act of 2017” (the Act), which was signed into law by President Trump on September 29, 2017. Among the relief provided in the Act was the option for a “qualified individual” (see below) to use either current or prior year’s income for purposes of claiming the EITC. Specifically, under the Act, if the earned income of a qualified individual for the tax year which includes the applicable date (i.e., the dates shown in the … Read More

2017 HURRICANE RELIEF: IRS PROVIDES SAFE HARBOR METHODS FOR DETERMINING NONBUSINESS CASUALTY LOSSES – REV PROC 2018-08

NSTPNatural Diaster

In Revenue Procedure 2018-08, IRS has provided safe harbor methods that individual taxpayers may use in determining the amount of their casualty and theft losses for their personal-use residential real property and personal belongings. For a safe harbor under which individuals may use one or more cost indexes to determine the amount of loss to their homes as a result of Hurricane and Tropical Storm Harvey, Hurricane Irma and Hurricane Maria. New safe harbors for determining the amount of losses: IRS has become aware that taxpayers often have difficulty determining the amount of their losses under the methods provided in Reg. § 1.165-7(a)(2), which has resulted in time-consuming and expensive litigation. In order to provide certainty to both taxpayers and IRS, the Revenue Procedure provides safe harbor methods that individuals may use under Reg. § 1.165-7(a)(2) to measure the decrease in the FMV of their personal-use residential real property following a casualty and to determine the pre-casualty or theft FMV of personal belongings. Qualifying to use the safe harbors: An individual who has suffered a casualty loss to the individual’s personal-use residential real property may use one of the first three safe harbor methods described in “Personal-use residential real property safe harbor … Read More

2017 HURRICANE RELIEF: IRS PROVIDES SAFE HARBOR FOR DETERMINING CASUALTY LOSS TO A HOME – REV PROC 2018-9

NSTPNatural Diaster

In Revenue Procedure 2018-9, IRS has provided a safe harbor method under which individuals may use one or more cost indexes to determine the amount of loss to their homes as a result of Hurricane and Tropical Storm Harvey, Hurricane Irma and Hurricane Maria (2017 Hurricanes). An individual with a U.S. income tax filing requirement who suffered a casualty loss to the individual’s personal-use residential real property located in the “2017 Disaster Area” as a result of the 2017 Hurricanes may use the safe harbor method provided in Rev Proc 2018-9 (the “Cost Indexes Safe Harbor Method”) in determining the amount of the individual’s casualty loss under Code Sec. 165. The term “2017 Disaster Area” means the entire states of Texas, Louisiana, Florida, Georgia, and South Carolina, the Commonwealth of Puerto Rico, and the territory of the U.S. Virgin Islands. Rev Proc 2018-9 applies to bona fide residents of Puerto Rico and the U.S. Virgin Islands only where these individuals otherwise have a U.S. income tax filing requirement. For purpose of Rev Proc 2018-9, personal-use residential real property is real property, including improvements (such as buildings and ornamental trees and shrubbery), that is owned by the individual who suffered a … Read More

FLORIDA CPAS OFFER HELP IN THE WAKE OF HURRICANE IRMA

NSTPNatural Diaster

The Florida Institute of CPAs has created a website to assist accountants in the Sunshine State and line up volunteers and office space for those affected by Hurricane Irma. The site, https://irma.ficpa.org/, said FICPA has a Member Services Team to help FICPA members recovering from the effects of the devastating storm. They can be reached at (800) 342-3197 or by emailing msc@ficpa.org. Volunteers who can help FICPA CPAs or others in the affected areas can also send a message to the same email address and they will be contacted about how they can pitch in with the relief efforts. In addition, people who have disaster-related technical tax questions can email them to the same address, and FICPA experts plan to provide answers to technical questions on an ongoing basis. FICPA has also set up an online form for CPAs who need office space if their buildings have been damaged. After they fill it out, FICPA will try to match them with available office space in their area. CPAs and their clients should also beware of shady charities that spring up in the wake of disasters like Hurricane Irma, one anti-fraud expert is warning. “We need to be very careful because after … Read More