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How to deduct your losses following Hurricane Michael

| Dec 6, 2018 | Tax Law |

When Hurricane Michael tore through the southeastern part of the country earlier this year, it left many communities devastated. In Georgia, 69 counties were hit particularly hard—and are therefore eligible for certain benefits.

In a previous post, we discussed the various tax deadline extensions that Georgia’s hurricane victims can receive. In this article, we provide further information on how victims can deduct their hurricane-related losses.

What to claim as a loss

You can claim any damage to your property during a natural disaster as a “casualty loss.” Claims can include damage to your home as well as any belongings that were lost or damaged. You should thoroughly catalogue all items you lost—from furniture to linens, shoes to books. You also need to appraise any belongings according to the base price as well as the decrease in fair market value. In addition, if you had to move into a rental unit or other temporary housing following the disaster, you may be able to write this off as well.

What to deduct from your losses

It’s important to understand that when you claim losses on your tax return, you need to deduct any financial help you received from other sources. If you received aid from the Red Cross or FEMA, subtract this amount from your loss.

In addition, bear in mind that casualty losses are the difference between your total loss and your insurance reimbursement. Any payments you received—or expect to receive—from insurance should be deducted from your total loss.

Rebuilding your life following a hurricane can be an overwhelming, all-consuming process—and making sense of disaster-related tax protocols may be more than you can handle. In such cases, an experienced tax attorney can provide valuable assistance in ensuring your taxes are filed correctly—and with the greatest possible benefit to you.

We insist that your taxpayer rights are protected and your options are known.

Our services are confidential and are protected under the attorney-client privilege as allowed by law.