8 November 2018 Most things in Paradise and on the Ridge changed 31 January 2024 House of Representatives passes the HR4970 4 December 2024 The Senate passes HR5863, which includes 4970 "Protect Innocent Victims of Taxation After Fire Act We are waiting on the POTUS signature, scheduled for next week (9th December)

What was signed you ask?

This bill eliminates:

double taxation of the lawyer fees taxation on the "Nuisance" money taxation on 'Wages' which is listed in the Determination notice as 'Personal Income Loss' and or 'Business Income Loss' taxation on the interest received appears to be taxable based on updated information from LaMalfa's office. We are honored to have worked with Doug LaMalfa's office directly and support the team from his office and Mike Thompson's whilst they worked on this great legislation. It took a lot of time but it finally got done.

Our office alone will be recovering over 100 Million US$ dollars for taxpayers that declared the money at the time of filing. We estimate we will be recovering (conservatively 23 MILLION US$ coming back to victims from Sharrett Bookkeeping filings alone)

Now What?

At Sharrett Bookkeeping & Income Tax Service, if you are an existing client, we will be be amending your returns previously filed (for 2021, 2022 and 2023). This will result in refunds coming to you. We will start the process now but the IRS is CLOSED UNTIL END OF JANUARY 2025 for filing.

If we have NOT called you by the 20th of January to come in and sign and such, please give us a call. Until then we are heads down on preparing the returns. More in our letter coming out this next week too.

We will prepare your returns for the years indicated. For 2021, you have to mail the return in yourself. For 2022 and 2023, we will obtain your signature and file as soon as the IRS opens at the end of January. The IRS takes roughly 16-18 weeks to process amended returns. You can imagine with the influx they will have come end of January it will take longer than normal.

There is a cost per year (175US$ for Personal and 250US$ for Business) to do amendments as we advised the time of original filings but it will be well worth it.

If you are a new client needing us to amended a return previously filed we will be happy to help you as well. We would have to see your original return to be able to determine costs for doing the amendments.

Remember a few things when filing an amended return. (1) It takes the IRS 16-18 weeks to process; (2) Amended returns usually result in paper checks being sent out to you; (3) Make sure the address on your amended return is your current address; (4) Remember you have 3 years to amend your return. Don't rush and do it wrong.

UPDATED INFORMATION - 5 DECEMBER 2024

A clarification on time frames for filing. This is directly from Doug's office liaison I have worked with closely on wording and such.

From the date of signature of the POTUS or lack there of, after 10 days of being on his desk, Taxpayers will have ONE YEAR to file filed in 2020 and 2021.

"Lastly, once the bill becomes law, a one-year timer starts. During this one year period, payment recipients can file an amended tax return to reduce their previously paid tax liability based on any wildfire payments received in 2020 - 2025. This should result in a refund/credit of previously paid taxes. After the one-year period expires, recipients can still file amended returns, but only for payments received up to three years ago."

A clarification on what is included in being relieved. Again, a PSA only. we are not able to comment and start the process.

"The term (“qualified wildfire relief payment”) used to describe the awards/settlements/monies that will be excluded from income is defined as: Payments to individuals compensating them for losses, expenses, or damages incurred as a result of a qualified wildfire disaster. In addition to the general terms “losses, expenses, or damages,” the legislation also includes specific mention of the following eligible reasons for compensation: Additional living expenses. Lost wages. Personal injury. Death. Emotional distress."

Please note, in our understanding, INTEREST PAID to you from the FVT would still be taxable, just like coming from a bank or such.

For those asking about other wildfires the legislation states the following: "Federally-declared disasters, occurring on January 1, 2015 or later, and which started as a forest or range fire."