Individuals and businesses are still feeling the effects of hurricanes Irma, Harvey, and Maria; with another hurricane, Nate, making landfall this weekend. A new law aims to help victims of these hurricanes with an array of tax relief measures and incentives.
On September 29th, the Disaster Tax Relief Act of 2017 was signed into law, providing emergency tax relief for individuals and employers in the areas affected by hurricanes Harvey, Irma and Maria.
For businesses, the prime benefit will likely come from a new employee retention tax credit. Companies could receive a credit of up to $2,400 per each employee, if their principal place of employment is located within one of the disaster zones. The tax credit equals 40% of the first $6,000 of wages incurred or paid to employees for each day the business was inoperable because of the storms from September 5 to December 31, 2017. These businesses can convey the credit for 20 years if they are not able to claim the credit for 2017.
For individual taxpayers, the major alteration in the new law is the removal of the current legal requirement that personal casualty losses must exceed 10 percent of adjusted gross income to qualify for deduction.
Other changes include the temporary removal of limitations on charitable deductions related to qualified hurricane relief donations given before December 31, 2017. The measure also provides an exemption to the 10 percent early retirement plan withdrawal penalty for qualified hurricane relief usage.
On October 3, U.S. Senator of Florida, Bill Nelson signed a bill calling for additional tax relief measures for individuals and small businesses. Nelson’s bill contains provisions to assist citrus farmers across Florida by allowing them to deduct hurricane-related clean-up expenses, as well as extending tax breaks to victims in Puerto Rico and additional U.S. territories.
Unsure of how these tax relief measures and incentives could affect you and your business? Give BluePoint Financial a call to learn more.
BluePoint Financial, LLC
151 Regions Way, Suite 6B
Destin, FL 32541