Tax Relief for Hurricane Sandy Victims

By Greenstein, Rogoff, Olsen and Co., LLP

Hurricane Sandy has left, but the East Coast is still in trouble. A new winter storm is predicted this weekend. While still dealing with the aftermath of Sandy, this winter storm may bring high winds, rain, coastal flooding, and snow in some parts of New York and New Jersey. To help victims of Hurricane Sandy, the IRS is providing tax relief. Here is a list of how the IRS is helping.

Tax Deadline Postponement
Taxpayers in Connecticut, New Jersey and New York will receive relief. This relief will postpone tax filing and payment deadlines that occurred in late October. Affected individuals and businesses will have until February 1, 2013 to file these returns. This will also include the 4th quarter individual estimated tax payment that is normally due on January 15,2013. Payroll and excise tax returns normally due on October 31, 2012 and January 31, 2013 will also be included. It will also apply to tax-exempt organizations. This relief is automatically granted, and no action is required by the taxpayer.

Additional Tax Relief
The IRS has also stated that they will work with those that reside outside the disaster areas, but whose books,records or tax professional are located in the affected areas. Also, workers that are assisting in relief activities in the disaster areas and are affiliated with a recognized government or philanthropic organization are eligible for relief.

Leave-Donation Programs
Yesterday, the IRS announced a special relief that is intended to support leave-based donation programs to aid victims of Hurricane Sandy. Through these programs, employees can donate their vacation, sick or personal leave in exchange for employer cash payments that will be made to tax-exempt organizations. Employers can forgo leave in exchange for employer cash payments made before January 1, 2014. This donated leave will not be included in the income or wages of the employee and employers will be allowed to deduct the cash payment amount.

Diesel Fuel Penalty Waived
One result of Hurricane Sandy is shortages of clear diesel fuel. The IRS has announced that they will not impose a tax penalty on those selling or using dyed diesel fuel on the highway. The relief is available if the operator or seller pays the 24.4 cents per gallon tax that is normally applied to diesel fuel use. This relief will take effect in New Jersey,New York and Pennsylvania from October 30, 2012 to November 20, 2012.

Availability of Housing
The IRS is temporarily suspending income limitation requirements and non-transient requirements for those that qualify for low-income housing. This will provide more housing for the victims of Hurricane Sandy that are not considered low-income.