Don't Mess With Taxes

The Geostationary Operational Environmental Satellite (GOES) view of Hurricane Lane near Hawaii via the National Oceanic and Atmospheric Administration (NOAA). Click image to watch the radar loop.

Hawaii, it's Big Island already soaked by Hurricane Lane's rains, is bracing for a very near miss from the biggest weather threat to the Aloha State in decades.

The storm, which hit category 5 strength earlier this week before settling in at a still very dangerous category 4, could come close to the islands of Oahu, Molokai and Maui on today and Saturday. Even without making landfall, Lane's size and rainfall reach could, warns the National Weather Service, produce "significant and life-threatening flash flooding and landslides."

As the Lane headed toward America's Paradise, the White House on Wednesday, Aug. 22, issued an emergency declaration for Hawaii.

This official presidential action authorizes the Federal Emergency Management Agency (FEMA) to coordinate disaster relief efforts on the islands and mobilize federal assets as needed. Expect the Internal Revenue Service to soon announce special tax considerations for affect residents.

California fire follow-up: The IRS also took added action on another disaster along the United States' Pacific coast.

Lake County, California, residents now are included in the tax relief related to the Golden State wildfires. Previously, the IRS issued the special tax considerations only for residents of Shasta County, which was hard hit by the Carr fire.

With the added fire area, Lake County residents now will get the same tax treatment as Shasta County resident. This includes certain later tax deadlines for individual and business taxpayers.

You can find more on the California tax relief in my earlier post on the IRS actions in connection with the state's wildfires.

Preparing for the worst: It's easy to focus on the current natural disasters, but everyone should remember that disasters can occur any time.

Tomorrow, Aug. 25, is the one-year anniversary of Hurricane Harvey, the deadly tropical system that devasted portions of Houston and the Texas Gulf Coast.

September historically is the busiest month for Atlantic and Gulf of Mexico hurricanes and tropical storms. And the hurricane season actually officially runs through November.

If you live in areas that could be hurricane targets, get ready now. You can find tips on how to prepare, both physically and financially, for hurricanes and other natural disasters at the ol' blog's special Storm Warnings page. There you'll find a collection of posts on getting ready for, as well as recovering from and helping others who sustain disaster damages.

And note that starting this year, in order to claim a tax break for such losses, your disaster must be, like those in Hawaii and California, declared major disasters.

As someone who's lived through several direct 'cane hits, I hope you don't ever need that major disaster designation. But if it does happen, be ready and take advantage of the tax options.

You also might find these items of interest:

• Take a pre-disaster inventory of your home
• 4 things to do when a hurricane approaches
• Home basis, not market value, key amount in calculating disaster loss tax claim