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State Tax Relief for Tsunami Waves

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Public Affairs Office
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For Immediate Release

04.28.2011

Sacramento – The Franchise Tax Board (FTB) announced that California taxpayers affected by the tsunami waves in the federally-declared disaster area will be given special tax relief.

The President declared a major disaster for Del Norte and Santa Cruz counties from the tsunami waves resulting from the March 11, 2011, earthquake that hit Japan.

Special tax rules apply to disaster losses. Affected taxpayers can claim a disaster loss in the year before the disaster occurred by claiming it on their 2010 original tax return if they have not yet filed. Those who have already filed their 2010 state return can still claim a disaster loss with Form 540X, Amended Individual Income Tax Return. The advantage of claiming a disaster loss in the prior year is that FTB can quickly issue a refund. Taxpayers can wait and claim a disaster loss on the 2011 tax return due next year.

Taxpayers claiming the disaster loss should write “Tsunami Waves” in red ink at the top of the tax return to alert FTB to expedite the refund. Taxpayers e-filing should follow the software instructions to enter the disaster information.

Disaster losses are reduced by any insurance proceeds or other reimbursements they receive. The following publications provide guidelines on calculating those losses.

FTB 1034 - Disaster Loss How to Claim a State Tax Deduction
FTB 1001 - Supplemental Guidelines of California Adjustments
IRS 547 - Casualties, Disasters and Thefts

Affected taxpayers can request free copies of state tax returns with FTB 3516, Request for Copy of Tax Return. This form is available online at ftb.ca.gov. The name of the disaster should be printed in red at the top of the request.

For more information on other taxes and fees in California, visit: taxes.ca.gov.

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