If your business had to shut down for a period of time due to the California wildfires, you may be eligible to take a tax credit on your 2017 tax return.
A tax credit of 40% of up to $ 6,000 of qualified wages (max credit is $ 2,400 per employee) is available to eligible employers in the California wildfire disaster zones, who were unable to operate their businesses (but continued to pay wages) from the date of the disaster. The employer is required to reduce the amount of their deduction for salaries and wages by the amount of the credit. An eligible employer is one who conducted an active trade or business in the California wildfire disaster zone on 10/8/17 and whose trade or business was inoperable on any day after 10/8/17 and before 1/1/18 because of wildfire damage.
The employee retention credit is calculated on Form 5884-A Credits for Affected Disaster Area Employers and flows to Form 3800 General Business Credits. If you are unable to take the credit in the current year due to tax liability limitations, you can carry it forward 20 years.
(Special Thanks to Vicki Mulak, EA, CFP for her compendium on disasters)