Can I deduct losses from Declared Disaster Areas on my tax return?

Casualty losses are generally tax deductible on your tax return only in the tax year the casualty loss occurred. However, if you have a tax deductible casualty loss from a disaster in an area that is officially designated by the President of the United States as eligible for federal disaster assistance, a Declared Disaster Area, you can choose to deduct that casualty loss on your tax return for the tax year immediately preceding the casualty loss tax year. In other words, you may treat the Declared Disaster Area loss as having occurred in either the current tax year or the previous tax year, whichever provides the best tax results for you on your tax return. If you have already filed your tax return for the preceding tax year, the Declared Disaster Area casualty loss may be deducted by filing an amended tax return, Form 1040X.

If you have been impacted by a Presidentially declared disaster, the IRS can help you by delaying collection of tax you owe and by eliminating tax penalties and interest if the disaster has caused you to file your tax return late or pay your tax late. The IRS can provide copies or transcripts of previously filed tax returns free of charge, and you may be able to get some money back from the IRS right now. Their disaster services page, Help During Disasters and Emergencies, provides more detail and provides a link to the Federal Emergency Management Agency (FEMA).

Also check Around the Nation for any additional information your local IRS office may have provided.

Related information about Declared Disaster Areas

Tax Directory Topics:
Involuntary Conversions
Itemized Tax Deductions Directory

IRS publications about Declared Disaster Areas:
For additional information on disaster area losses (including flood losses), refer to Tax Topic 515, or IRS Publication 547,

Casualties, Disasters and Thefts (Business and Non-Business). IRS Publication 584,

Nonbusiness Disaster, Casualty, and Theft Loss Workbook, can be used to help you catalog your property. Also see IRS Publication 17,

Your Federal Income Tax. Please read this IMPORTANT Editor's Note regarding navigating IRS publications with Adobe Acrobat Reader.
IRS publications can also be ordered by calling 1-800-829-3676.

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