1/10/97
                                                              
97-2 


              IRS GRANTS TAX RELIEF TO STORM VICTIMS

     Washington -- The Internal Revenue Service is granting some
tax relief to individuals and businesses in the areas of several
Western states that have been declared disaster areas due to
recent floods.  
     There will be no penalty for late payment of estimated taxes
-- due Jan. 15 -- if the payment is made by Jan. 22.  
     Employers in the affected areas will have until Feb. 18 to
issue Forms W-2 to their employees.  Banks and corporations have
the same extension for issuing Forms 1099 for interest and
dividend payments.  Taxpayers have until Feb. 18 to file these
four forms which are due Jan. 31:
     -- Form 720, Quarterly Excise Tax Return;
     -- Form 940, Annual Federal Unemployment Tax Return;
     -- Form 2290, Heavy Vehicle Use Tax;
     -- Form 730, Tax on Wagering.

     Although the IRS cannot extend the deadline for employment
tax returns or tax deposits, it will abate penalties for Forms
941, 941M, 943 and 945 filed by February 18.  It will likewise
abate penalties on tax deposits due between December 20 and
January 31 if the deposits are made by Feb. 18.  Interest charges
apply to payments made after the original due date of the return
and cannot be waived.
     In addition to the relief above, the IRS will suspend many
enforcement activities -- such as levies, seizures and summonses
-- for taxpayers within the disaster areas through February 7. 
IRS representatives will be at disaster assistance centers to
help taxpayers with returns or to expedite requests for tax
account transcripts needed for disaster-related loans.
     Taxpayers in disaster areas may claim uninsured casualty
losses on their tax returns for either the year in which the
disaster occurred or the preceding year.  Claiming the loss on
the prior year return enables taxpayers to get any resulting
refunds sooner.  
     Affected taxpayers should put the words "(State name) FLOOD
DISASTER" at the top of any return relying on flood-related
relief.  
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