In certain situations, the Internal Revenue Service (IRS) can provide disaster relief to individuals and businesses who have suffered economic losses as a result of living or working in an area impacted by a disaster. The most common type of relief that the IRS provides is additional time to file income tax returns and to pay taxes. For businesses affected by disasters, the most common type of relief offered by the IRS is that they will waive failure to deposit penalties for employment and excise deposits for a certain time period. To qualify for disaster relief from the IRS, the disaster must be a federally declared disaster.
Some federal disaster areas which have benefited from IRS tax relief include areas affected by Hurricane Katrina and areas affected by the Gulf Oil Spill, although there are many more areas that have been declared federal disaster areas that have benefited from IRS tax relief. The IRS website (www.irs.gov) lists which areas are classified as federal disaster areas and the tax benefits currently available. If you are unsure if your area is a federally declared disaster area, check the IRS website to see if your area qualfies for disaster relief. The IRS regularly updates its site and will have the latest information on which areas qualify and the types of relief available.