Don't Mess With Taxes

While most of us put tax filing duties behind us months ago, the deadline for some northeastern residents is Monday.

Select folk in Connecticut, Maine, New Hampshire, New Jersey and New York who suffered through severe storms just before the regular April filing deadline were given until June 25 to get their returns on the way to the IRS.

The region's inclement weather back then produced widespread flooding, incapacitated public transportation and led to power outages that made it impossible for many filers to fulfill their tax responsibilities.

The extension applies to residents of the following counties:

• Hartford, Fairfield, Litchfield, Middlesex, New Haven, New London and Windham in Connecticut
• Cumberland, Knox, Lincoln, Oxford, Sagadahoc and York in Maine
• Belknap, Grafton, Hillsborough, Merrimack, Rockingham and Strafford in New Hampshire
• Bergen, Burlington, Camden, Essex, Gloucester, Hudson, Mercer, Middlesex, Morris, Passaic, Somerset and Union in New Jersey and
• Albany, Dutchess, Orange, Richmond, Rockland, Ulster and Westchester in New York.

Thanks to new technology, the IRS computer systems will automatically identify taxpayers located in a covered disaster area and automatically note the filer's allowed extension. That means you no longer have to worry about noting the applicable disaster at the top of your paper 1040 or using your software's "disaster" feature if you e-file.

Special disaster tax options: One other thing to consider if you're working on your 2007 return this weekend: Check into whether you can claim any property damage from the spring storms.

When an area is a presidentially declared disaster area, you can opt to claim any disaster-related casualty losses on the tax return for the year it occurred (in this case, on 2007 returns  filed next year) or you can claim the loss on your prior year's returns (in this instance, the 2006 returns due now). Run the numbers to see which tax-year filing will give you the best result, i.e., the most money back or smallest tax bill.

If you find it more advantageous to make the claims on your 2006 return, the IRS says in this case you do need to write "April 16 Storm" at the top of the form or follow your software's directions to help speed up the processing of any refund.

You can find more on filing disaster tax claims in this story, as well as in IRS Publication 547, "Casualties, Disasters and Thefts."