Tax breaks may await some county residents|[11/13/05]
Published 12:00 am Monday, November 14, 2005
Seven weeks remain in tax year 2005, but now is the time for those living in counties declared federal disaster areas after Hurricane Katrina to get familiar with new tax relief legislation.
The Katrina Emergency Tax Relief Act of 2005, signed Sept. 23 by President Bush, enables taxpayers living in counties or parishes earmarked for individual assistance by the Federal Emergency Management Agency to claim tax credits in a variety of areas, including retirement withdrawals, housing evacuees, employing workers who lived in affected areas and certain charitable activities.
Warren County is one of 47 Mississippi counties in which taxpayers could be automatically eligible for them, thanks to its designation by FEMA as an individual assistance area. Claiborne and Hinds are also among the affected counties.
Sharkey and Issaquena are two of the 35 counties in which residents may take advantage of the credits only if they identify themselves as Katrina victims by writing “Hurricane Katrina” in red ink at the top of their tax forms.
In all affected areas, deadlines have been extended to Feb. 28, for filing all time-sensitive submissions, including paying taxes. Additionally, no penalties or interest will be charged for filing late returns if the return is filed and all taxes due are paid in full by the new deadline.
This new deadline also extends to those who pay their income taxes quarterly and those who had received a second extension for filing their individual return for 2004.
The Internal Revenue Service advises anyone who still receives a penalty notice to contact the phone number on the notice to receive a penalty adjustment.
As for the state, the Mississippi State Tax Commission will follow the federal guidelines governing the new deadline. Anyone receiving a penalty notice from the state is asked to call the commission’s offices at 601-923-7000 to have state tax penalties adjusted.
In all, the new legislation modifies rules regarding 19 topics. Most notable among them are: