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Los Angeles Times
19-04-2025
- Business
- Los Angeles Times
Have you experienced a disaster? You have more time to file your taxes
NEW YORK — If your life has been upended by a wildfire, hurricane, flood, tornado, or another disaster this past year, the IRS recognizes that you may need more time to file your taxes and grants you an automatic extension beyond the normal filing deadline, which is Tuesday. You're also permitted to write off a certain amount of loss due to disaster, reducing your tax burden. That could be damaged property, lost income, or small business losses. 'It can feel really daunting and overwhelming, after you've already lost your home or your vehicle, to tackle that project (of loss write-off). It can take time and a lot of energy,' said Alison Flores, manager at the Tax Institute for H&R Block. 'We see people be hesitant to tackle that, and so they leave that loss on the table.' In the wake of a disaster, people are also more vulnerable to scams, so be extra vigilant as you prepare your taxes, even with the extra time of an IRS extension. 'Scammers often pose as representatives of the IRS or FEMA to exploit victims of disasters,' said Misty Erickson, tax content program manager at the National Association of Tax Professionals. 'Common scams include false promises of tax refunds, fake charities soliciting donations, and phishing attempts requesting personal or financial information.' Here's what you should know: The IRS keeps an official list online of all disaster locations that qualify you for an extension to file. For the past year, individuals and businesses affected by Hurricanes Helene and Milton qualify for tax relief, as well as disaster victims in parts of Alabama, Florida, Georgia, North Carolina, South Carolina, New Mexico, Tennessee, Virginia, West Virginia, and Alaska. Taxpayers in these areas have until May 1 to file returns and make payments, and there's no need to do any additional paperwork to receive that extra two week grace period. Filers also have the option to request additional extensions to October 15, but interest will accrue if any money due isn't paid by May 1. Individuals and businesses in southern California affected by wildfires and straight-line winds also qualify for automatic extensions due to disaster. Taxpayers in the relevant counties have until Oct. 15 to file returns and make payments. Any interest or fees that normally accrue on late payments won't accrue during disaster extensions. Most direct disaster relief is also not counted as income, and so is not taxed. While nothing is easy in the first days and weeks following a disaster, a few choices can help when seeking insurance reimbursement and at tax time. 'We recommend saving media coverage,' said Flores. 'If your neighborhood was on the news showing the disaster, write down what date that was or record that copy. Anything that substantiates your losses and what condition your property was in is helpful.' According to the IRS, other steps include: — Taking photographs of damaged property or belongings to document and calculate the amount of your loss. — Keeping receipts for associated expenses, including contracted work on property damaged by disaster. — Keeping records of the original value of any property, including a home, car, jewelry, or big credit card purchases. Filing your insurance claims as soon as possible is also important, as you deduct any insurance reimbursement from disaster losses claimed on your tax return. 'When we look at a loss, it's often damage to your home, furnishings inside your home, vehicles, that kind of thing,' Flores said. 'Most of the time, people will have home insurance and auto insurance, and file claims. That's the first step. The tax deduction is for loss that's not paid for or reimbursed by your insurance.' The IRS calls this kind of disaster relief 'casualty loss.' Claiming casualty loss doesn't result in dollar-for-dollar reimbursement, but it does lower your tax burden, which can mean more cash to help pay for recovery. Form 4684, which you include when you file your return, walks you through the relevant steps for calculating your casualty write-off. Victims of disasters may deduct their losses in either the year they suffered the loss or in the previous year — in that case, by filing an amended return. In the wake of a disaster, it's normal to feel vulnerable and to listen to voices that promise relief. But scammers often target disaster victims for exactly this reason. 'Taxpayers should be cautious of unsolicited phone calls, emails or texts claiming to be from the IRS or relief agencies,' said Erickson. 'The IRS never initiates contact via email, text, or social media to request sensitive information. When in doubt, taxpayers should verify correspondence by calling official numbers directly.' According to the IRS, you should watch out for: — Big paydays: The promise of more money than you think sounds reasonable. Bad advisers may make outlandish statements about available credits. — Threats and demands: Any pressure to pay for tax help 'now or else,' mentions of arrest or deportation, or refusals to let you question or appeal the taxes they say you owe. — Suspicious or misspelled website links that aren't Scammers may say that they want to 'help' you file casualty loss claims or to get big refunds. Always rely on official IRS government websites and beware fishy offers of help with high price-tags or sensational promises. Lewis writes for the Associated Press.
The Hill
14-04-2025
- Business
- The Hill
Have you experienced a disaster? You have more time to file your taxes
NEW YORK (AP) — If your life has been upended by a wildfire, hurricane, flood, tornado, or another disaster this past year, the IRS recognizes that you may need more time to file your taxes and grants you an automatic extension beyond the normal filing deadline, which is Tuesday. You're also permitted to write off a certain amount of loss due to disaster, reducing your tax burden. That could be damaged property, lost income, or small business losses. 'It can feel really daunting and overwhelming, after you've already lost your home or your vehicle, to tackle that project (of loss write-off). It can take time and a lot of energy,' said Alison Flores, manager at the Tax Institute for H&R Block. 'We see people be hesitant to tackle that, and so they leave that loss on the table.' In the wake of a disaster, people are also more vulnerable to scams, so be extra vigilant as you prepare your taxes, even with the extra time of an IRS extension. 'Scammers often pose as representatives of the IRS or FEMA to exploit victims of disasters,' said Misty Erickson, tax content program manager at the National Association of Tax Professionals. 'Common scams include false promises of tax refunds, fake charities soliciting donations, and phishing attempts requesting personal or financial information.' Here's what you should know: First, determine whether your area is a federally declared disaster site The IRS keeps an official list online of all disaster locations that qualify you for an extension to file. For the past year, individuals and businesses affected by Hurricanes Helene and Milton qualify for tax relief, as well as disaster victims in parts of Alabama, Florida, Georgia, North Carolina, South Carolina, New Mexico, Tennessee, Virginia, West Virginia, and Alaska. Taxpayers in these areas have until May 1 to file returns and make payments, and there's no need to do any additional paperwork to receive that extra two week grace period. Filers also have the option to request additional extensions to October 15, but interest will accrue if any money due isn't paid by May 1. Individuals and businesses in southern California affected by wildfires and straight-line winds also qualify for automatic extensions due to disaster. Taxpayers in the relevant counties have until Oct. 15 to file returns and make payments. Any interest or fees that normally accrue on late payments won't accrue during disaster extensions. Most direct disaster relief is also not counted as income, and so is not taxed. Remember that simple steps in the immediate aftermath can make a difference While nothing is easy in the first days and weeks following a disaster, a few choices can help when seeking insurance reimbursement and at tax time. 'We recommend saving media coverage,' said Flores. 'If your neighborhood was on the news showing the disaster, write down what date that was or record that copy. Anything that substantiates your losses and what condition your property was in is helpful.' According to the IRS, other steps include: — Taking photographs of damaged property or belongings to document and calculate the amount of your loss. — Keeping receipts for associated expenses, including contracted work on property damaged by disaster. — Keeping records of the original value of any property, including a home, car, jewelry, or big credit card purchases. Filing your insurance claims as soon as possible is also important, as you deduct any insurance reimbursement from disaster losses claimed on your tax return. Next, determine whether you qualify for tax deductions 'When we look at a loss, it's often damage to your home, furnishings inside your home, vehicles, that kind of thing,' Flores said. 'Most of the time, people will have home insurance and auto insurance, and file claims. That's the first step. The tax deduction is for loss that's not paid for or reimbursed by your insurance.' The IRS calls this kind of disaster relief 'casualty loss.' Claiming casualty loss doesn't result in dollar-for-dollar reimbursement, but it does lower your tax burden, which can mean more cash to help pay for recovery. Form 4684, which you include when you file your return, walks you through the relevant steps for calculating your casualty write-off. Victims of disasters may deduct their losses in either the year they suffered the loss or in the previous year — in that case, by filing an amended return. Watch out for scams In the wake of a disaster, it's normal to feel vulnerable and to listen to voices that promise relief. But scammers often target disaster victims for exactly this reason. 'Taxpayers should be cautious of unsolicited phone calls, emails or texts claiming to be from the IRS or relief agencies,' said Erickson. 'The IRS never initiates contact via email, text, or social media to request sensitive information. When in doubt, taxpayers should verify correspondence by calling official numbers directly.' According to the IRS, you should watch out for: — Big paydays: The promise of more money than you think sounds reasonable. Bad advisers may make outlandish statements about available credits. — Threats and demands: Any pressure to pay for tax help 'now or else,' mentions of arrest or deportation, or refusals to let you question or appeal the taxes they say you owe. — Suspicious or misspelled website links that aren't Scammers may say that they want to 'help' you file casualty loss claims or to get big refunds. Always rely on official IRS government websites and beware fishy offers of help with high price-tags or sensational promises. ___ The Associated Press receives support from Charles Schwab Foundation for educational and explanatory reporting to improve financial literacy. The independent foundation is separate from Charles Schwab and Co. Inc. The AP is solely responsible for its journalism.
Yahoo
14-04-2025
- Business
- Yahoo
Have you experienced a disaster? You have more time to file your taxes
NEW YORK (AP) — If your life has been upended by a wildfire, hurricane, flood, tornado, or another disaster this past year, the IRS recognizes that you may need more time to file your taxes and grants you an automatic extension beyond the normal filing deadline, which is Tuesday. You're also permitted to write off a certain amount of loss due to disaster, reducing your tax burden. That could be damaged property, lost income, or small business losses. 'It can feel really daunting and overwhelming, after you've already lost your home or your vehicle, to tackle that project (of loss write-off). It can take time and a lot of energy,' said Alison Flores, manager at the Tax Institute for H&R Block. 'We see people be hesitant to tackle that, and so they leave that loss on the table.' In the wake of a disaster, people are also more vulnerable to scams, so be extra vigilant as you prepare your taxes, even with the extra time of an IRS extension. 'Scammers often pose as representatives of the IRS or FEMA to exploit victims of disasters,' said Misty Erickson, tax content program manager at the National Association of Tax Professionals. 'Common scams include false promises of tax refunds, fake charities soliciting donations, and phishing attempts requesting personal or financial information.' Here's what you should know: First, determine whether your area is a federally declared disaster site The IRS keeps an official list online of all disaster locations that qualify you for an extension to file. For the past year, individuals and businesses affected by Hurricanes Helene and Milton qualify for tax relief, as well as disaster victims in parts of Alabama, Florida, Georgia, North Carolina, South Carolina, New Mexico, Tennessee, Virginia, West Virginia, and Alaska. Taxpayers in these areas have until May 1 to file returns and make payments, and there's no need to do any additional paperwork to receive that extra two week grace period. Filers also have the option to request additional extensions to October 15, but interest will accrue if any money due isn't paid by May 1. Individuals and businesses in southern California affected by wildfires and straight-line winds also qualify for automatic extensions due to disaster. Taxpayers in the relevant counties have until Oct. 15 to file returns and make payments. Any interest or fees that normally accrue on late payments won't accrue during disaster extensions. Most direct disaster relief is also not counted as income, and so is not taxed. Remember that simple steps in the immediate aftermath can make a difference While nothing is easy in the first days and weeks following a disaster, a few choices can help when seeking insurance reimbursement and at tax time. 'We recommend saving media coverage,' said Flores. 'If your neighborhood was on the news showing the disaster, write down what date that was or record that copy. Anything that substantiates your losses and what condition your property was in is helpful.' According to the IRS, other steps include: — Taking photographs of damaged property or belongings to document and calculate the amount of your loss. — Keeping receipts for associated expenses, including contracted work on property damaged by disaster. — Keeping records of the original value of any property, including a home, car, jewelry, or big credit card purchases. Filing your insurance claims as soon as possible is also important, as you deduct any insurance reimbursement from disaster losses claimed on your tax return. Next, determine whether you qualify for tax deductions 'When we look at a loss, it's often damage to your home, furnishings inside your home, vehicles, that kind of thing,' Flores said. 'Most of the time, people will have home insurance and auto insurance, and file claims. That's the first step. The tax deduction is for loss that's not paid for or reimbursed by your insurance.' The IRS calls this kind of disaster relief 'casualty loss." Claiming casualty loss doesn't result in dollar-for-dollar reimbursement, but it does lower your tax burden, which can mean more cash to help pay for recovery. Form 4684, which you include when you file your return, walks you through the relevant steps for calculating your casualty write-off. Victims of disasters may deduct their losses in either the year they suffered the loss or in the previous year — in that case, by filing an amended return. Watch out for scams In the wake of a disaster, it's normal to feel vulnerable and to listen to voices that promise relief. But scammers often target disaster victims for exactly this reason. 'Taxpayers should be cautious of unsolicited phone calls, emails or texts claiming to be from the IRS or relief agencies,' said Erickson. 'The IRS never initiates contact via email, text, or social media to request sensitive information. When in doubt, taxpayers should verify correspondence by calling official numbers directly.' According to the IRS, you should watch out for: — Big paydays: The promise of more money than you think sounds reasonable. Bad advisers may make outlandish statements about available credits. — Threats and demands: Any pressure to pay for tax help 'now or else,' mentions of arrest or deportation, or refusals to let you question or appeal the taxes they say you owe. — Suspicious or misspelled website links that aren't Scammers may say that they want to 'help' you file casualty loss claims or to get big refunds. Always rely on official IRS government websites and beware fishy offers of help with high price-tags or sensational promises. ___ The Associated Press receives support from Charles Schwab Foundation for educational and explanatory reporting to improve financial literacy. The independent foundation is separate from Charles Schwab and Co. Inc. The AP is solely responsible for its journalism.
Associated Press
14-04-2025
- Business
- Associated Press
Have you experienced a disaster? You have more time to file your taxes
NEW YORK (AP) — If your life has been upended by a wildfire, hurricane, flood, tornado, or another disaster this past year, the IRS recognizes that you may need more time to file your taxes and grants you an automatic extension beyond the normal filing deadline, which is Tuesday. You're also permitted to write off a certain amount of loss due to disaster, reducing your tax burden. That could be damaged property, lost income, or small business losses. 'It can feel really daunting and overwhelming, after you've already lost your home or your vehicle, to tackle that project (of loss write-off). It can take time and a lot of energy,' said Alison Flores, manager at the Tax Institute for H&R Block. 'We see people be hesitant to tackle that, and so they leave that loss on the table.' In the wake of a disaster, people are also more vulnerable to scams, so be extra vigilant as you prepare your taxes, even with the extra time of an IRS extension. 'Scammers often pose as representatives of the IRS or FEMA to exploit victims of disasters,' said Misty Erickson, tax content program manager at the National Association of Tax Professionals. 'Common scams include false promises of tax refunds, fake charities soliciting donations, and phishing attempts requesting personal or financial information.' Here's what you should know: First, determine whether your area is a federally declared disaster site The IRS keeps an official list online of all disaster locations that qualify you for an extension to file. For the past year, individuals and businesses affected by Hurricanes Helene and Milton qualify for tax relief, as well as disaster victims in parts of Alabama, Florida, Georgia, North Carolina, South Carolina, New Mexico, Tennessee, Virginia, West Virginia, and Alaska. Taxpayers in these areas have until May 1 to file returns and make payments, and there's no need to do any additional paperwork to receive that extra two week grace period. Filers also have the option to request additional extensions to October 15, but interest will accrue if any money due isn't paid by May 1. Individuals and businesses in southern California affected by wildfires and straight-line winds also qualify for automatic extensions due to disaster. Taxpayers in the relevant counties have until Oct. 15 to file returns and make payments. Any interest or fees that normally accrue on late payments won't accrue during disaster extensions. Most direct disaster relief is also not counted as income, and so is not taxed. Remember that simple steps in the immediate aftermath can make a difference While nothing is easy in the first days and weeks following a disaster, a few choices can help when seeking insurance reimbursement and at tax time. 'We recommend saving media coverage,' said Flores. 'If your neighborhood was on the news showing the disaster, write down what date that was or record that copy. Anything that substantiates your losses and what condition your property was in is helpful.' According to the IRS, other steps include: — Taking photographs of damaged property or belongings to document and calculate the amount of your loss. — Keeping receipts for associated expenses, including contracted work on property damaged by disaster. — Keeping records of the original value of any property, including a home, car, jewelry, or big credit card purchases. Filing your insurance claims as soon as possible is also important, as you deduct any insurance reimbursement from disaster losses claimed on your tax return. Next, determine whether you qualify for tax deductions 'When we look at a loss, it's often damage to your home, furnishings inside your home, vehicles, that kind of thing,' Flores said. 'Most of the time, people will have home insurance and auto insurance, and file claims. That's the first step. The tax deduction is for loss that's not paid for or reimbursed by your insurance.' The IRS calls this kind of disaster relief 'casualty loss.' Claiming casualty loss doesn't result in dollar-for-dollar reimbursement, but it does lower your tax burden, which can mean more cash to help pay for recovery. Form 4684, which you include when you file your return, walks you through the relevant steps for calculating your casualty write-off. Victims of disasters may deduct their losses in either the year they suffered the loss or in the previous year — in that case, by filing an amended return. Watch out for scams In the wake of a disaster, it's normal to feel vulnerable and to listen to voices that promise relief. But scammers often target disaster victims for exactly this reason. 'Taxpayers should be cautious of unsolicited phone calls, emails or texts claiming to be from the IRS or relief agencies,' said Erickson. 'The IRS never initiates contact via email, text, or social media to request sensitive information. When in doubt, taxpayers should verify correspondence by calling official numbers directly.' According to the IRS, you should watch out for: — Big paydays: The promise of more money than you think sounds reasonable. Bad advisers may make outlandish statements about available credits. — Threats and demands: Any pressure to pay for tax help 'now or else,' mentions of arrest or deportation, or refusals to let you question or appeal the taxes they say you owe. — Suspicious or misspelled website links that aren't Scammers may say that they want to 'help' you file casualty loss claims or to get big refunds. Always rely on official IRS government websites and beware fishy offers of help with high price-tags or sensational promises. ___ The Associated Press receives support from Charles Schwab Foundation for educational and explanatory reporting to improve financial literacy. The independent foundation is separate from Charles Schwab and Co. Inc. The AP is solely responsible for its journalism.
Yahoo
09-04-2025
- Business
- Yahoo
Thinking you might not file your tax return? Reconsider, if you want to save money
There is just under a week left before the official April 15 tax filing deadline. More than half of all expected federal tax returns have been filed – nearly 90 million as of March 28, according to the latest filing statistics from the Internal Revenue Service. If yours isn't among them – and you haven't been granted a special extension to file because you live in a federally declared disaster area – you may be tempted to think the IRS won't miss it or won't go after you if you don't file – given the upheaval at the agency since the new 'Department of Government Efficiency' installed operatives there. Or maybe you don't want to file because you owe money and can't afford to pay your balance due. Whatever the case, here is why it's in your financial interests – on top of your legal requirement and civic duty – to file anyway. If you owe money to the IRS, you could be subject to two different penalties plus interest if you don't file and don't pay what you owe by April 15. The biggest upfront penalty will come if you don't file a return on time. You will be charged 5% of your unpaid taxes for every month you don't file. The total penalty assessed may not exceed 25% of your outstanding debt. If you don't think that's a big deal because you figure what you owe is small and you can handle that monthly penalty, consider this: If the 5% you're assessed is below $510 and your return is more than 60 days late, starting after day 60, you will be assessed a minimum of $510 per month going forward or 100% of what you owe, whichever is less. 'If you have a balance due, don't file late because you will compound your problems,' said North Carolina-based CPA Jim Buttonow. The good news: It is easy to avoid a late-filing penalty. If you really can't get your return in by April 15, just submit Form 4868 by next Tuesday to get an automatic six-month extension. Your new filing deadline will then be pushed to October 15. If you don't even do that, technically, the IRS can choose to file a 'substitute' return for you based on the third-party reporting it has on your income (e.g., copies of income forms it received from your employers and banks and brokerages, such as W2s and 1099s). 'That return will not have (all) the deductions or credits a taxpayer is entitled to. This typically results in higher taxes owed than if the taxpayer filed their own return,' said Misty Erickson, tax content manager at the National Association of Tax Professionals. Even if you file for an extension, you still have to pay what you owe by April 15. If you don't, you will be subject to a failure-to-pay penalty that amounts to 0.5% of your unpaid balance every month until you file or until the overall total you pay hits 25% of what you owe. In the case of both the failure-to-file and the failure-to-pay penalties, interest will accrue not only on your unpaid taxes but on the penalty, too. The agency has an automated process in place through which it sends out balance-due notices (known as the CP14 notice) to individuals within 60 days after the April 15 deadline, Erickson said. So, your records will show that you owe money. If you can't pay what you owe in full, try to pay whatever you can by April 15. Then, either call the agency at the number on the CP14 notice or review the IRS payment plan options to see if one makes sense for you. (If you're confused or want to contest what you owe, it may help to work with an enrolled agent, CPA or tax attorney, who can represent you before the IRS.) If you don't owe the IRS any more money, you won't be assessed a failure-to-file penalty if you don't file. But you may be penalized in other ways. For instance, you might be due a refund. If you don't file, you won't be paid. Ditto if you are owed refunds from prior tax years for which you didn't file returns. Last month, the IRS announced that there is still more than $1 billion in unclaimed refunds for 2021. Since the law allows taxpayers three years to file and claim their refunds, this April 15 will be your last opportunity to file your 2021 return to claim any refund you're owed for that year. If you're self-employed, any year you don't file a tax return means the income you earned that year won't be reported to the Social Security Administration. So, 'you will not receive credits toward Social Security retirement or disability benefits,' the IRS notes on its site. And if you're trying to secure a loan, lenders will want to see your most recent return. If you don't have one, that could affect your chances or timeline for loan approval. Sign in to access your portfolio
