On August 27 Hurricane Irene made U.S. landfall on the coast of North Carolina and then headed northward eventually crossing borders into 13 states, causing billions of dollars worth of damage in the process. In North Carolina alone, the storm killed 7 people and destroyed more than 1.100 homes. Nationally, at least 45 people were reported killed in the storm.
The damage continues to add up as homeowners and farmers learn more about the storm's effects. The cost of damage to farms, rural business and private homes can be minimized in many cases if it qualifies as a casualty loss due to unexpected damage, says Guido van der Hoeven, a North Carolina Cooperative Extension specialist at N.C. State University.
Van der Hoeven points out the Internal Revenue Code has provisions that allow people in such circumstances to apply beneficial tax rules, if they meet qualifications.
How can you know if you are eligible? Van der Hoeven recommends you study two documents available through the website RuralTax.org. The documents explain how to apply the rules to business and to personal casualty losses.
The two documents include an article on involuntary conversion (http://ruraltax.org/files/uploads/Involuntary%20Conversion%20of%20Business%20Assets%20Final.pdf) due to a casualty loss and a related article on weather related sales of livestock (http://ruraltax.org/files/uploads/Livestock%20Sales%20(RTE%202010-09).pdf)..
Cooperative Extension educators and professional tax preparers may be resources to access this information and provide income tax information relative to a potential casualty loss.
Van der Hoeven also encourages individuals to contact their income tax professional to determine how these rules may apply to their specific circumstances.
Last week N.C. Governor Beverly Perdue applied for and announced seven counties in North Carolina had been approved for federal assistance. President Barack Obama okayed her request for a disaster declaration for Beaufort, Carteret, Craven, Dare, Hyde, Pamplico and Tyrell counties,
The presidential declaration means the Federal Emergency Management Agency can provide low interest loans or grants to hurricane survivors to repair homes, pay medical costs and/or rebuild their businesses.
Read additional Irene Recovery Information at N.C. State University's Disaster Information Center, located on the Internet at http://www.ces.ncsu.edu/disaster/.