The recent heavy weather from hurricane Irene that has affected many parts of the Eastern United States has caused damage to agriculture, rural and coastal businesses.
In many cases the damage to farms, rural businesses and private homes qualifies as a casualty loss due to the unexpected damage, says Guido van der Hoeven, a North Carolina Cooperative Extension specialist at N.C. State University.
The Internal Revenue Code has provisions that allow persons affected by such sudden events to apply beneficial tax rules to their circumstances if they meet the qualifications of these rules.
Van der Hoeven recommends that individuals and clients of professional tax preparers relative to casualty losses and other tax issues look at two documents available through the website RuralTax.org. The fact sheets explain how to apply the rules to business as well as personal casualty losses. These 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.