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IRS TAX RELIEF FOR LOUISIANA STORM VICTIMS

♠ Posted by Marc Soss in ,, at Thursday, September 08, 2016
IRS Announcement 2016-30 provides relief to Louisiana taxpayers suffering hardships as a result of the storms and flooding which that began August 11, 2016. The relief comes in the form of impacted residents being able to obtain a loan or in-service distribution from their retirement plans. Retirement plan administrators may rely upon representations by an employee or former employee as to the need for a hardship distribution as a result of the Louisiana storms and the distribution will be treated as a hardship distribution for all purposes. The relief applies to a employee or former employee whose: (i) Principle residence on August 11, 2016, was located in one of the parishes that has been identified as part of a covered disaster area because of the devastation caused by the Louisiana Storms; (ii) Place of employment was located in one of these parishes on that date; or (iii) Lineal ascendant or descendant, dependent, or spouse had a principle residence or place of employment in one of these parishes on that date. The hardship distribution must be made on or after August 11, 2016, and no later than January 17, 2017. Any loans made in accordance with the relief must be repaid in accordance with their terms, and any distributions will be subject to income tax and generally to the ten percent penalty on early distributions.