The IRS extended deadlines for filing returns and paying taxes in the wake of this fall’s devastating hurricanes, which caused billions of dollars in damages to homes, businesses, equipment, agriculture, and timber. States also responded with deadline extensions and have expanded that relief to support recovery of key industries as the extent of the damage continues to be documented.
For example, Georgia Gov. Nathan Deal (R) signed legislation specifically focused on helping the timber industry recover from the destruction. The state’s new Timber Producer tax credit is available to individuals who produce timber and have casualty losses related to Hurricane Michael. The credit is 100 percent of the taxpayer’s timber casualty loss, but cannot exceed the number of the taxpayer’s affected acres of eligible timber property multiplied by $400. Taxpayers must claim the credit in the taxable year in which the taxpayer first completes the replanting of timber in a quantity projected to yield at maturity at least 90 percent of the value of the timber casualty loss claimed.
Georgia capped the aggregate amount of this credit at $200 million for the duration of its availability through Dec. 31, 2024. Considering these limitations, those who are eligible shouldn’t unnecessarily delay submitting applications for preapproval of the credit based on their timber losses.
Recent wildfire activity on the west coast has also caused significant damage to property. Typical deadline extensions are available for filing and paying taxes, but no industry-based tax relief has yet been announced. California and other West Coast states are gearing up for their legislative sessions, so those affected by the wildfires should stay tuned for any new relief that may become available.
Continue the discussion on Bloomberg Tax’s State Tax Group on LinkedIn: What other forms of tax relief should states offer to residents affected by hurricanes and other natural disasters?
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