Federal Tax Filing and Payment Relief for Sandy's Victims

. November 21, 2012

The IRS has announced that it is waiving various tax filing and payment deadlines and penalties for Connecticut taxpayers who live or have businesses in the Connecticut locations covered by the president's federal disaster declaration for Hurricane Sandy.  The declaration covers Fairfield, Middlesex, New Haven, and New London counties and the Mashantucket and Mohegan tribal nations.  The relief also covers taxpayers who do not live in the disaster areas but whose tax records needed are located there; relief workers affiliated with recognized organizations; and anyone visiting the disaster area who was killed or injured because of it.

The relief gives affected taxpayers until February 1, 2013 to file and make payments, including estimated payments due between October 27 and February 1.  The deadline extensions apply to individual, corporate, partnership, S corporation, and trust income tax returns and to estate, gift, and generation-skipping transfer tax returns.  The IRS is also waiving penalties for failing to deposit employment and excise tax payments due on or after October 27 and before November 26, as long as the payments are made by November 26.  Normal fees for copies of filed tax returns for affected taxpayers will also be waived.

Affected taxpayers can claim disaster-related losses on 2011 or 2012 federal income tax returns. Claiming losses on an original or amended return for 2011 brings a faster refund but, depending on other income factors, claiming the loss on a 2012 return may generate greater tax savings, the IRS advises.