IRS, N.Y. State Announce Tax Relief Efforts for Hurricane Victims

Shortly following the devastation of the Gulf Coast by Hurricane Katrina, the Internal Revenue Service announced that it would partner with the American Institute of Certified Public Accountants (AICPA) to provide assistance to taxpayers at local disaster recovery centers established by the Federal Emergency Management Agency (FEMA).

According to the IRS, terms of the partnership agreement stipulate that the IRS and the AICPA will test the use of volunteer CPAs at FEMA’s disaster recovery centers to facilitate service to those seeking aid. Volunteers will join forces with IRS employees to staff the disaster recovery centers.

“With so many American lives disrupted by Hurricane Katrina and its aftermath, the ability to expand service by using CPA volunteers should help reduce some of the tax issues victims will face,” said IRS Commissioner Mark Everson. “These volunteers will provide the technical expertise and skills necessary to explain the laws regarding disaster-related tax relief.”

The IRS also announced that it would give taxpayers unable to meet their tax obligations in 64 Louisiana parishes, 52 Mississippi counties, six Alabama counties and three Florida counties generally until Oct. 31 to file tax returns and make payments. For the hardest-hit areas, the IRS stated that it anticipates extending these deadlines even further.

In related news, the New York State Department of Taxation and Finance announced that taxpayers who are unable to meet their New York state tax return filing and payment obligations because of Hurricane Katrina may qualify for a waiver of certain penalties.

“During this time of crisis, the victims of Hurricane Katrina should focus on bringing stability to their lives and businesses and not worry about meeting a tax filing deadline,” Commissioner Andrew Eristof said.

Businesses and individuals located in a Presidentially Declared Disaster Relief Area, and those whose tax records or tax practitioners are located there, may qualify for waivers of late filing and late payment penalties. Eristof said that affected taxpayers should write “Hurricane Katrina Relief” at the top of their New York state tax return when they file it, and attach an explanation of the specific facts and circumstances related to the delay caused by Hurricane Katrina. In the event penalties are imposed, taxpayers should notify the Tax Department that they qualify for the waiver of penalties because of Hurricane Katrina.

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