The IRS announced (press release MA-2011-30) that victims of the tornadoes that occurred in Western Massachusetts on June 1, 2011 are entitled to extensions for filing tax returns and depositing tax payments. For details, see the press release. Everyone who lived or worked in Hampden County or Worcester County when the disaster occurred is eligible for the tax relief, regardless of whether that individual was directly harmed by the incident. There are two extensions:
(1) “The IRS is waiving the failure-to-deposit penalties for employment and excise tax deposits due on or after June 1 and on or before June 16, as long as the deposits were made by June 16.” [Curiously, the date of the press release is June 16. The IRS did not give any extension for the period of time after it made the announcement of relief. I would assume that the IRS expects anyone affected to be able to make those payments within two weeks after the disaster occurred.] Anyone who is facing a penalty for failure-to-deposit, and wishes for relief because of the special disaster rules, should contact the IRS disaster hotline at 1-866-562-5227.
(2) Aside from the foregoing instance, the IRS extends the deadline for all forms and payments that are due after June 1 but before August 8 so that the new deadline is August 8, 2011. Therefore, the second-quarter estimated tax payment which is normally due on June 15 will be due this year on August 8. A corporation with a March 31 fiscal year end (unusual) would also normally need to file its tax return by June 15, and can now file it on or before August 8, 2011.
Also, the IRS allows tax filers to deduct casualty losses for either last year’s tax return (so that you can get your refund this year) or this year’s tax return. You should consult a tax or financial advisor to decide how to elect to take the casualty loss deduction, whether to choose the 2010 tax return or the 2011 tax return.
If you have suffered a significant loss in this disaster or any disaster, consult the IRS web page “Tax Relief in Disaster Situations.” If you need professional assistance, please consider calling our office.
UPDATE (June 23, 2011): The Massachusetts Department of Revenue also announced tax filing relief for anyone who is eligible for relief from the IRS because of the June 1 storms. See TIR 11-4: Extension of Time for Certain Tax Filings.