Tax tip for hurricane harvey, irma & maria victims

Tax tip for hurricane harvey, irma & maria victims

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Tax tip for hurricane harvey, irma & maria victims
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Old 12-22-2017, 10:04 AM
Bloom&Company Bloom&Company is offline
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Join Date: Dec 2016
Location: Haciendas of Mission Hills
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Default Tax tip for hurricane harvey, irma & maria victims

A new tax law now allows casualty losses from hurricanes to be deducted “above the line” rather than as an itemized deduction. This can be a significant tax savings for taxpayers who normally do not itemize or have higher income levels.

Previously, a taxpayer would be required to itemize their deductions on Schedule A to claim a casualty loss. In addition, the amount of the loss deducted would be only the amount in excess of 1) $100 plus 2) 10% of their Adjusted Gross Income. The new law changes those limitations to be only $500.

In order to qualify as a loss, the casualty must be from the hurricane and the loss must be uninsured (your insurance company must have declined the claim).
The law also allows a taxpayer to choose which year they prefer to take the deduction, 2016 or 2017.

Determining which year to claim the deduction is predominately driven by the tax bracket the taxpayer is in. Obviously, if the tax bracket is higher in 2016 than it will be in 2017 then the refund of tax from the claimed loss would be more in 2016.

For questions, or if you would like to discuss strategic tax planning or having your tax return prepared, please give me a call. I have a boutique tax practice in The Villages where I come to your home and meet with you, discuss your tax needs, and give you a definite price to complete your work. I then bring back your completed return to you. I am reasonably priced, reliable, responsible, trustworthy, and licensed in the State of Florida. I had a tax practice in Seattle for over 35 years and specialized in individual and closely held businesses. I now enjoy specializing in working with Villagers. I live in The Villages as well. My number is 425 941 5224 and I respond between 8 am and 8 pm seven days a week. I am available throughout the year for consultation and questions. You can find references for me on Talk of The Villages. Bob Bloom CPA 425 941 5224

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