The federal government offers a tax deduction for home casualty losses. This is an itemized deduction, so qualification depends on the individual finances of a taxpayer. Deductions drop taxable income and the amount of tax due, and can therefore be helpful to a home owner. This blog provides advice on Haddonfield New Jersey real estate casualty loss tax write-offs.
Definition of a Casualty Loss
The federal government considers a casualty loss as the “damage, destruction, or loss of property resulting from an identifiable event that is sudden, unexpected, or unusual.” It may take place with natural disasters such as tornados or man-made ones such as acts of terrorism. There are other restrictions offered in IRS Publication 547: Casualties, Disasters and Thefts.
Guidance On Taking the Deduction
When to Take It
If the event occured during an presidentially declared disaster, then you can alter your tax return from the last year to deduct the damage. This could generate a tax refund. Otherwise, home owners must delay until the next tax filing.
First and foremost, the deduction is only applicable to losses not covered by insurance and other sources of aid. The amount of a deduction depends on the decline in fair market value of a home as a result of the damage or destruction, the income of the home owner, and a few other factors. Federal and state tax laws will vary.
About Advice On Haddonfield New Jersey Real Estate Casualty Loss Tax Write-offs
Always talk to a tax consultant on tac deductions, how much you cna take, and differences with federal and state returns. This blog provides advice on Haddonfield New Jersey real estate casualty loss tax write-offs and is intended to make you aware of possible deductions. It does not at all imply that you will be able to incorporate deductions on your specific tax return.