Disaster Loss

Today TaxMama hears from Debbie in Washington State who tells us, “We were affected by a Federally acknowledged disaster in December of 2007. The repair costs are in 2008, but I can’’t find where to claim them. What do I do?”

Dear Debbie,

Sorry to hear that. I hope everything’s all better now?

IRS Publication 547 deals with disasters and casualties. It’s a long read, but explains a lot.
http://www.irs.gov/publications/p547/index.html

IRS has a set of workbooks for casualty losses. Publication 584 is for personal losses
http://www.irs.gov/publications/p584/index.html

Publication 584-B is for business-related losses, in case you had any of those.
http://www.irs.gov/publications/p584b/index.html

You will report the losses on Form 4684. http://www.irs.gov/pub/irs-pdf/f4684.pdf

You can report the losses in 2007 by amending your tax return; or 2008 by reporting the losses when the amounts were finally determined.

Consider getting help for this. It’s a little complicated. The first one I ever filed got audited. It turned out really well. (Many, many years ago…) But I doubt your loss will be, since so many are filed when there are disasters like yours.

If you don’t want to, or can’t afford to hire a tax professional, check with the local IRS VITA program. They may be able to help you without any charge. They are trained volunteers.
http://www.irs.gov/individuals/article/0,,id=107626,00.html

And remember, you can find answers to all kinds of questions about casualty losses and other tax issues, free. Where? Where else? At TaxMama.com

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