SFL 2003-07, May 2, 2003

FORT LAUDERDALE – The Internal Revenue Service today announced special tax relief for residents of the Miami-Dade County Presidential Disaster Area that was struck by severe storms and tornadoes on March 27. 

For the purposes of this tax relief, affected taxpayers include individuals and businesses located in the disaster area, those whose tax records are located in the disaster area, and relief workers.

Affected taxpayers have the option of claiming disaster-related casualty losses on either their 2002 or 2003 federal income tax returns.  Claiming the loss on an original or amended 2002 return will get the taxpayer an earlier refund, but waiting to claim the loss on the 2003 return could result in a greater tax saving, depending on other income factors. 

Individuals may deduct personal property losses that are not covered by insurance or other reimbursements, but they must first subtract $100 for each casualty event and then subtract ten percent of their adjusted gross income from their total casualty losses for the year.  For details on figuring a casualty loss deduction, see IRS Publication 547, Casualties, Disasters and Thefts.

Affected taxpayers claiming the disaster loss on a 2002 return should put the words “Severe Storms/Tornadoes-FL” in red ink at the top of the form so that the IRS can expedite the processing of the refund.

The IRS will waive the usual fees and expedite requests for copies of previously filed tax returns for affected taxpayers who need them to apply for benefits or to file amended returns claiming casualty losses.  Such taxpayers should put “Severe Storms/Tornadoes-FL” in red ink at the top of Form 4506, Request for Copy or Transcript of Tax Form, and submit it to the IRS.

Although the IRS is not granting additional time to file returns or pay taxes, it will abate penalties, based on reasonable cause, for affected taxpayers who file and pay by July 1, 2003, those returns or payments due from March 27 to July 1.  Individuals or businesses located in this county – or taxpayers outside this county that were directly affected by these storms – should contact the IRS if they receive penalties for filing returns or paying taxes late.  Interest on overdue taxes will not be abated in this situation.  

Affected taxpayers who are contacted by the IRS on a collection or examination matter should explain that the disaster impacts them so that the IRS can provide appropriate consideration to their case.

The IRS toll-free number for general tax questions is 1-800-829-1040.  Taxpayers needing in-person assistance can go to the Miami office at 51 SW 1st Avenue.  Hours are 8:00am to 4:30pm daily.