Disaster and Business Taxes
If you own a business damaged or destroyed by a natural disaster, you will have some meager consolation when filling out your tax returns.
Losses to businesses are fully tax-deductible. Those businesses eligible for federal disaster relief by the Federal Emergency Management Agency (FEMA) may claim their loss for the tax year of the disaster or the year before (through an amended return). The latter choice, which could result in a tax refund, can help your business recover financially. You cannot declare any losses that you recoup from insurance or other reimbursements.
With a FEMA-designated disaster, the Internal Revenue Service can extend tax return deadlines, including payroll and excise taxes, as it did after the hurricanes earlier this year. The IRS automatically applies filing and payment relief to taxpayers in eligible areas. See IRS Publication 547 for details or talk to your tax professional for additional guidance.
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