The hurricane recovery process can be arduous. In addition to rebuilding, property owners must meticulously document in writing and with photos every bit of damage caused by flooding, wind or other storm-related factors, in order to properly file insurance and FEMA claims. Insurance proceeds and other forms of economic recovery come with tax implications for which property owners must be aware. While many owners will be able to deduct casualty losses, they must also recognize that when insurance proceeds or other recoveries exceed the tax basis of the damaged property, they could end up with a casualty gain.
Generally, there are two options for property owners to deduct uninsured and unreimbursed losses:
1. Claim the loss on a tax return for the year it occurred
2. Deduct the casualty loss on an original or amended return for the tax year immediately preceding the disaster (e.g., 2016 for victims of Hurricanes Harvey and Irma).
If property owners are unsure of how to navigate through this process, they should contact trusted real estate professionals, accountants of insurance advisors.
The professionals with Orion Real Estate Group work with investors, developers, property owners and brokers through all phases of real estate transactions, from strategic planning and analysis to financing, negotiation, property management and disposition. For more information, call (305) 278-8400 or email firstname.lastname@example.org.