Should Disaster Victims use E-filing for Their Tax Returns?

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A growing trend in e-filing poses a threat to disaster victims. Will they be able to claim their loss or will they lose their deduction?

The growing trend in e-filing may cost disaster victims their tax deduction. E-filing uses IRS approved tax software packages that are prepared for the general public. Given that disaster victims must provide additional information and detailed calculations in order to take full advantage of their tax deduction, should disaster victims e-file?

“Absolutely not,” says Dr. Anne-Marie Pollowy Toliver, author of the HOME OWNER'S GUIDE TO DISASTER TAX RELIEF. “The IRS requires proof for the disaster loss calculations and all relevant documentation should be included with the disaster victim’s tax return.”

What to do if a disaster victim has already e-filed?

Dr. Pollowy, herself a disaster survivor, suggests that all taxpayers who have experienced a disaster in 2003, 2004, 2005, take another look at their e-filed tax return. Did they claim a disaster loss (or possibly a gain) on their Schedule A (Itemized Deductions)?

If a disaster loss was not claimed, it’s not too late! Disaster victims can prepare amended returns for 2003 and 2004. For a 2005 return, disaster victims should immediately apply for a deadline extension if it has not already been granted by the IRS.

How can disaster victims get tax assistance for their 2005 returns or for amended returns?

The IRS provides extensive tax assistance to disaster victims. Before seeking assistance the victims must prepare the documentation of their loss; without such documentation, tax assistance becomes impossible. Dr. Pollowy recommends using the extensive examples in the “Home Owner’s Guide to Disaster Tax Relief.” The Guide, written in an easy-to-read format to help disaster victims understand and follow IRS regulations, shows clearly and precisely how to prove a loss, how to prepare a claim and how to take advantage of some unexpected benefits.

The Guide is available in a downloadable e-book version (ISBN 0-9765763-1-7) from the website at http://www.disaster-tax-relief.com/efile, and in both the downloadable and paper versions (ISBN 0-9765763-0-9) from any major online bookseller.

With their loss calculations completed, disaster victims can obtain tax return preparation assistance at the IRS’ Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) sites where hurricane-affected taxpayers needing help can be referred to participating members of the American Institute of Certified Public Accountants (AICPA) or the American Association of Attorney-Certified Public Accountants (AAA-CPA) for free return preparation assistance.

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Annemarie Pollowy Toliver