Wildfire areas in Amador, Calaveras, Lake and Napa counties are were declared as a California State of Emergency by Governor Brown. Therefore, there are certain Franchise Tax Board (FTB) tax relief benefits that are available for individuals and businesses in the impacted disaster zones.
The President of the United States made a similar declaration for victims the Valley and Butte fires; so Internal Revenue Service (IRS) tax benefits and tax relief may also be available to fire victims. Unfortunately however, victims need to make sure that their residence or business location has been certified by the state and/or federal government to be eligible for to the disaster based tax relief.
It does seem like common sense that if you live in one of these disaster areas, you really have bigger things to worry about than filing your tax return or making an estimated tax payment. However, without the disaster designations by both the state and federal government, there is likely no tax relief available.
Affected taxpayers in the designated disaster areas have the option of claiming disaster-related casualty losses on their income tax returns for either this year or last year. Claiming the loss on an original or amended return for last year will allow the taxpayer an earlier refund, but waiting to claim the loss on this year’s return could result in a greater tax saving, depending on other income factors. Deadlines have also been extended for filing tax returns that were on extension, and for paying estimated taxes and deposits.
Unfortunately, when there is a disaster there is the bad segment of humanity that preys on victims. The IRS is warning that there are even scam artist who are preying on people who are being charitable to the victims. The IRS is warning again of charity scams for disaster areas. These thieves make phony websites, and make solicitations using social media, email, and telephone phone calls trying to dupe their victims into donating to their own coffers instead of those of the disaster victims.
Money isn’t the only thing being stolen. The scams also include a ruse to obtain private information from those lending a hand to the victims. The IRS warns to not provide social security numbers, account numbers and passwords, or cash for such donations.
Lastly, do your research. Both the IRS and the Federal Emergency Management Agency maintain lists of legitimate qualified charities. So take the time to make sure your money is going to the right place before your part with it.
This article is not intended as legal advice, and cannot be relied upon for any purpose without the services of a qualified professional.