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Nail down casualty loss deductions

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in Small Business Tax,Small Business Tax Deduction Strategies

At this time of year, taxpayers throughout the country are at risk for various types of natural disasters, including hurricanes, tornadoes and wildfires.  

Strategy: Keep detailed records if your personal (nonbusiness) property is damaged or destroyed. Although it is small solace, you may be able to claim a casualty loss deduction on your 2017 tax return.

Generally, losses from all casualties during the year are lumped together for tax purposes. However, your annual deduction is subject to strict limits.

Here’s the whole story: To qualify for a casualty loss deduction, the regulations say that the damage must be caused by an event that is “sudden, unexpected, or unusual.” Typically, this includes damage from natural disasters like hurricanes, tornadoes, earthquakes and the like; but it also applies to events like car collisions. But deterioration or wear and tear occurring over a long period of time—such as loss of property d...(register to read more)

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