Guest Author - Kate Woods
I like to sprinkle my articles with humor as much as possible but there’s nothing humorous in disaster and devastation; and while disaster movies can be entertaining, real life disasters such as the California Wildfire disaster is anything but entertaining. The victims in the California presidential disaster area will have a long road ahead of them to reassemble their lives and they will probably carry the heartbreak with them forever.
Affected taxpayers have options regarding claiming for casualty loss related refunds. While they deal with all of the many tasks at hand they may overlook the fact that if they own property in the area declared a presidential disaster area by President Bush they can file an amended 2006 tax return or they can take the loss on their 2007 return. According to the IRS they may claim uninsured or unreimbursed disaster losses by filing an amended 2006 tax return and thereby receive an earlier refund when it may be most needed. Of course, they also have the option of waiting and filing the loss on their 2007 tax return. Both individuals and businesses are eligible for this treatment of handling a casualty loss by electing IRS Code Section 165 (i) treatment which applies to a disaster in an area declared by the President as a major disaster or emergency.
The IRS is supposed to expedite the processing of amended returns filed for disaster casualty losses. The return should be clearly notated with the appropriate disaster information such as CA Wildfires. The turnaround time for processing the returns is generally 60 days.
If you are a victim of the CA Wildfires and you think this might be an option you are interested in you should contact the IRS for additional information and instructions as needed or consult with a tax professional. My heartfelt thoughts and prayers are with you. If you know someone who is a victim and you are reading this I urge you to make them aware of this option. Often in the aftermath of such an overwhelming disaster important helpful information slips through the cracks and people miss out on much needed assistance that can make a dramatic difference in their ultimate recovery.
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