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Taxes Information |
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Hurricane Katrina - How To Use Your Business Loss To Get A Refund on 2004 Taxes
With the massive losses caused by Katrina, the economy of the Gulf Coast region is in extremely bad shape. Fortunately, there is a quirk in the tax code that can help you generate a large refund from your 2004 taxes. Apply Losses to 2004 Taxes When a large geographic area suffers a disaster, the President can declare it a federal disaster area. President Bush has made such a declaration for the Gulf Coast area. While you've probably heard such declarations occur over the years, I doubt it means much to you. The declaration, however, has major implications for recovery efforts. Initially, the declaration of a federal disaster area means the federal government is going to provide disaster relief loans, special grants that don't have to be repaid, unemployment benefits and a variety of other assistance. It also signifies a major tax break for impacted businesses. When a business suffers a loss, the deduction must typically be made in the year the loss occurred. With Hurricane Katrina, the deduction would typically occur when you file taxes in 2006. The problem, of course, is 2006 is a very long time from now if your business is destroyed. You will find this hard to believe, but the IRS is here to help. The IRS is going to give you cash. Under current tax law, you may make a special election to deduct your business losses caused by Katrina on your 2004 taxes. By doing this, you do not have to wait till 2006 to get a tax refund. You don't have to do this, but it may be the key to getting necessary cash. To make the special election, you must claim it on your 2004 taxes. If you have already filed taxes for 2004, you can file an amended tax return claiming the deduction. In Closing Using this tax strategy can help generate badly needed cash. Make sure you pursue the strategy with the help of your tax professional. If all your records are destroyed, you can order copies of past tax returns from the IRS. Richard Chapo is with http://www.businesstaxrecovery.com - recovering overpaid taxes for small businesses. Visit our article page - http://www.businesstaxrecovery.com/articles - to read more tax articles.
MORE RESOURCES: One state lawmaker wants to impose a tax on strip club patrons. Another plans to call for higher cigarette taxes. A third will propose putting the state's four percent sales tax back on all groceries. With the state facing a $2 billion to $2.5 billion shortfall this fiscal year and possibly worse financial news next year, lawmakers are searching for ways to fill gaps to avoid slashing education, ... T he tax deadline may be a few months away , but the IRS recommends getting ready early. T he IRS recommends getting all your records together now so you can see what you are missing and still have time to find it. F ind and download all forms you'll need to file your taxes and do a little research to make sure you are getting all eligible deductions and ... Property owners in Wake County are making payment arrangements for their taxes, ABC 11 reports. Property taxes for the third installment are January 5 and should be postmakred or received by January 15th to avoid a penalty. Some out-of-work residents choose not to have taxes withheld from their unemployment checks, but that can be dangerous. Property owners are seeking payment plans on their taxes in Wake County. SHELBY - Long lines formed at the Cleveland County Administrative building Monday as people paid their property taxes at the last minute.Jan. 5 is the final day to pay before interest begins to accrue.Derek Mauney, waiting in a line that stretched down A new poll shows that registered voters in New York appear willing to pay higher taxes in order to prevent spending cuts in the state’s massive Medicaid program. Antrim Township in Franklin County is eliminating property taxes. LANCASTER, Pa. -- The Lancaster City Council unanimously passed Mayor Rick Gray's 2009 budget. The $46 million spending plan calls for a 5 percent increase in property taxes. |
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