A possible tax hit for Sandy’s victims - MarketWatch: In addition to the tragedy of lost lives and injuries, Superstorm Sandy caused many billions of dollars in property damage. The sad truth: disasters occur every year in America. If you’re unlucky enough to suffer a disaster-related casualty, here’s what you need to know about the federal income tax implications.
People walk past a beach club destroyed by Hurricane Sandy in Sea Bright, New Jersey, October 31, 2012.
Theoretically, our beloved Internal Revenue Code allows you to claim an itemized deduction — on Schedule A of your Form 1040 — for personal casualty losses to the extent they are not covered by insurance. Exactly what is a casualty loss? It’s when the fair market value of your property or asset is reduced or wiped out by a hurricane, flood, storm, fire, earthquake or volcanic eruption (not to mention sonic boom, theft or vandalism).
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