IRS help for hurricane victims: a recap of key tax relief provisions available following Harvey, Irma, and Maria

Below is a summary of key tax relief that the Internal Revenue Service has made available to victims of Hurricanes Harvey, Irma, and Maria.

In general, the IRS is now providing relief to individuals and businesses anywhere in Florida, Georgia, Puerto Rico, and the Virgin Islands, as well as parts of Texas. Because this relief postpones various tax deadlines, individuals and businesses have until January 31, 2018, to file any returns and pay any taxes due. Those eligible for the extra time include:

• Individual filers whose tax-filing extension runs out on October 16, 2017. Because tax payments related to these 2016 returns were originally due on April 18, 2017, those payments are not eligible for this relief.
• Business filers, such as calendar-year partnerships, whose extensions ran out on September 15, 2017.
• Quarterly estimated tax payments due on September 15, 2017, and January 16, 2018.
• Quarterly payroll and excise tax returns due on October 31, 2017.
• Calendar-year tax-exempt organizations whose 2016 extensions run out on November 15, 2017.

A variety of other returns, payments and tax-related actions also qualify for additional time. See the disaster relief page on IRS.gov for details on these and offer relief the IRS has offered since these hurricanes began hitting in August. The IRS also continues to closely monitor the aftermath of these storms, and additional updates for taxpayers and tax professionals are posted to IRS.gov

Besides extra time to file and pay, the IRS has offered other special assistance to disaster-area taxpayers. This includes the following:

• Special relief helps employer-sponsored leave-based donation programs aid hurricane victims. Under these programs, employees may forgo their vacation, sick, or personal leave in exchange for cash payments the employer makes, before January 1, 2019, to charities providing relief. Donated leave is not included in the employee’s income, and employers may deduct these cash payments to charity as a business expense.
• 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to hurricane victims and members of their families. Under this broad-based relief, a retirement plan can allow a hurricane victim to take a hardship distribution or borrow up to the specified statutory limits from the victim’s retirement plan. It also means that a person who lives outside the disaster area can take out a retirement plan loan or hardship distribution and use it to assist a son, daughter, parent, grandparent, or dependent who lived or worked in the disaster area. Hardship withdrawals must be made by January 31, 2018.
• The IRS is waiving late-deposit penalties for federal payroll and excise tax deposits normally due during the first 15 days of the disaster period. Check out the disaster relief page for the time periods that apply to each jurisdiction.
• Individuals and businesses who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2017 return normally filed next year), or the return for the prior year (2016). See Pub. 547 for details.
• The IRS is waiving the usual fees and expediting requests for copies of previously filed tax returns for disaster area taxpayers. This relief can be especially helpful to anyone whose copies of these documents were lost or destroyed by the hurricane.
• If disaster-area taxpayers are contacted by the IRS on a collection or examination matter, they should be sure to explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case.

Further details on these and other relief provisions can be found on the agency’s disaster relief page, as well as on the special pages for Hurricane Harvey and Hurricane Irma. For information on disaster recovery, visit disasterassistance.gov.

Important 2017 tax reminders

Listed below are important reminders and other items that may help you file your 2017 tax return. Many of these items are explained in more detail later in this publication.

• Enter your social security number (SSN).

  Enter your SSN in the space provided on your tax form. If you filed a joint return for 2016 and are filing a joint return for 2017 with the same spouse, enter your names and SSNs in the same order as on your 2016 return. See chapter 1.

• Taxpayer identification numbers.

  You must provide the taxpayer identification number for each person for whom you claim certain tax benefits. This applies even if the person was born in 2017. Generally, this number is the person’s social security number (SSN). See chapter 1.

• Individual retirement arrangements (IRAs).

  For purposes of taking an IRA deduction, earned income includes any nontaxable combat pay received by a member of the U.S. Armed Forces.

• Qualified joint venture.

  A qualified joint venture conducted by you and your spouse may not be treated as a partnership if you file a joint return for the tax year. See chapters 12 and 39.

• Recordkeeping requirements for cash contributions.

  You cannot deduct a cash contribution, regardless of the amount, unless you keep as a record of the contribution with a bank record (such as a canceled check, a bank copy of a canceled check, or a bank statement containing the name of the charity, the date, and amount) or a written communication from the charity. The written communication must include the name of the charity and the date and amount of the contribution. See chapter 25.

• Foreign source income.

  If you are a U.S. citizen with income from sources outside the United States (foreign income), you must report all such income on your tax return unless it is exempt by U.S. law. This is true whether you reside inside or outside the United States and whether or not you receive a Form W-2 or 1099 from the foreign payer. This applies to earned income (such as wages and tips) as well as unearned income (such as interest, dividends, capital gains, pensions, rents, and royalties). If you live outside the United States, you may be able to exclude part or all of your foreign source earned income. For details, see chapter 42, U.S. citizens working abroad: Tax treatment of foreign earned income, and IRS Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.

• Foreign financial assets.

  If you had foreign financial assets in 2017, you may have to file Form 8938 with your return. Check www.IRS.gov/form8938 for details.

• Automatic six-month extension to file tax return.

  You can get an automatic 6-month extension of time to file your tax return. See chapter 1.

• Tax Computation Worksheet.

  If your taxable income is $100,000 or more, figure your tax using the Tax Computation Worksheet, which can be found at the IRS website (www.irs.gov). The Tax Rate Schedules in chapter 51 are shown so you can see the tax rate that applies to all levels of taxable income. Do not use the Tax Rate Schedules to figure your tax. Instead, see chapter 31.

• Joint return responsibility.

  Generally, both spouses are responsible for the tax and any interest or penalties on a joint tax return. In some cases, one spouse may be relieved of that responsibility for items of the other spouse that were incorrectly reported on the joint return. See chapter 2.

• Include your phone number on your return.

  The IRS can promptly resolve any questions they have in processing your tax return, by calling you. So, it can be helpful to enter your daytime telephone number on your tax form next to your signature and occupation. If you are filing a joint return, you can enter either your or your spouse’s daytime phone number.

• Third-party designee.

  You can check the “Yes” box in the “Third Party Designee” area of your return to authorize the IRS to discuss your return with a friend, family member, or any other person you choose. This allows the IRS to call the person you identified as your designee to answer any questions that may arise during the processing of your return. It also allows your designee to perform certain actions. See chapter 1.

• Frivolous tax submissions.

  The IRS has published a list of positions that are identified as frivolous. The penalty for filing a frivolous tax return is $5,000. See chapter 1.

• Filing erroneous claim for refund or credit.

  You may have to pay a penalty if you file an erroneous claim for refund or credit. See chapter 1.

• Payment of taxes.

  You can pay your taxes online, by phone, or by check or money order. You can make a direct transfer from your bank account or use a credit or debit card. See chapter 1.

• Faster ways to file your return.

  The IRS offers fast, accurate ways to file your tax return information without filing a paper tax return. You can use IRS e-file (electronic filing). See chapter 1.

• Free electronic filing.

  You may be able to file your 2017 taxes online for free. See chapter 1.

• Change of address.

  If you change your address, notify the IRS. See Change of Address in chapter 1.

• Private delivery services.

  You may be able to use a designated private delivery service to mail your tax returns and payments. See chapter 1.

• Refund on a late filed return.

  If you were due a refund but you did not file a return, you generally must file your return within 3 years from the date the return was due (including extensions) to get that refund. See chapter 1.

• Customer service for taxpayers.

  You can set up a personal appointment at the most convenient Taxpayer Assistance Center, on the most convenient business day.

• Privacy Act and paperwork reduction information.

  The IRS Restructuring and Reform Act of 1998, the Privacy Act of 1974, and the Paperwork Reduction Act of 1980 require that when the IRS asks you for information, the IRS must first tell you what its legal right is to ask for the information, why the IRS is asking for it, how the information will be used, what could happen if the IRS does not receive it, and whether your response is voluntary, required to obtain a benefit, or mandatory under the law. A complete statement on this subject can be found in your tax form instructions.

• Preparer e-file mandate.

  Most paid preparers must e-file returns they prepare and file. Your preparer may make you aware of this requirement and the options available to you.

• Secure your tax records from identity theft.

  Identity theft occurs when someone uses your personal information such as your name, SSN, or other identifying information, without your permission, to commit fraud or other crimes. An identity thief may use your SSN to get a job or may file a tax return using your SSN to receive a refund. For more information about identity theft and how to reduce your risk from it, see chapter 1.

• Protect yourself from suspicious emails or phishing schemes.

  Phishing is the creation and use of email and websites designed to mimic legitimate business emails and websites. The most common form is the act of sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft. The IRS does not initiate contacts with taxpayers via emails. Also, the IRS does not request detailed personal information through email or ask taxpayers for the PIN numbers, passwords, or similar secret access information for their credit card, bank, or other financial accounts. If you receive an unsolicited email claiming to be from the IRS, forward the message to: [email protected]. You may also report misuse of the IRS name, logo, forms, or other IRS property to the Treasury Inspector General for Tax Administration toll-free at 1-800-366-4484. You can forward suspicious emails to the Federal Trade Commission at: [email protected] or contact them at www.ftc.gov/idtheft or 1-877-IDTHEFT (1-877-438-4338). Visit www.irs.gov and enter “identity theft” in the search box to learn more about identity theft and how to reduce your risk.

• Treasury Inspector General for Tax Administration.

  If you want to confidentially report misconduct, waste, fraud, or abuse by an IRS employee, you can call 1-800-366-4484 (call 1-800-877-8339 if you are deaf, hard of hearing, or have a speech disability, and are using TTY/TDD equipment). You can remain anonymous.

• Tax questions.

  If you have a tax question, visit www.irs.gov or call 1-800-829-1040. For TTY/TDD, call 1-800-829-4059.