How To Get Tax Relief for Storm Damage

4/14/2022 (Permalink)

Storm damage to a commercial building in Westwood Village, CA.

How to Get Storm Damage Tax Relief

Storm damage to your commercial building in Westwood Village, CA, can end up costing a lot of money to repair. While a good insurance policy and timely response from storm restoration experts can significantly lower the hit to your budget, you probably will end up paying some out-of-pocket expenses that you weren't planning to spend. The good news is that you may be able to get tax relief.

Deductions

It is likely that a portion of the financial loss you endure due to an unexpected storm is tax-deductible. There are several things that factor into how much you can deduct:

• Your property's fair market value
  
• Timeliness of your insurance claim
  
• Amount of reimbursement you receive from your provider
  
  

Typically, you can claim these deductions in the year in which the storm occurs. If the storm damage is due to a federally declared disaster, however, you may have a little more choice in which year's tax rules will yield you a higher deduction.

Extensions

Another possible type of relief from both federal and state taxes is an extension on the due dates for filing and making payments. Your building does not necessarily have to be in the federally declared disaster area to qualify for these extensions. This reprieve can give you a little more time to get your business up and running again and recover some of the losses before having to make your tax payments.

Waivers

No matter how good your record-keeping is, a storm can destroy your tax files along with your building. The IRS often waives the fees to get copies of tax transcripts when a disaster is involved. This is particularly helpful when you are claiming your deduction on a previous year you have already filed.
While storm damage can be devastating to a business, help is available. Talk to your accountant about the potential tax relief that you can receive after disaster strikes.