HR 5863

[Phillybilly]

Hi All,

A new law allows for hurricane losses without restriction. Our condo has a special assessment for $10,500 for Ian. It appears that I can deduct the $10,500 from my FMV with an amended return. Has anyone done that yet? TIA

[SabrinaD2]

The Federal Disaster Tax Relief Act of 2023 (H.R. 5863), enacted on December 12, 2024, may allow taxpayers to deduct personal casualty losses from federally declared disasters, including Hurricane Ian, without the previous 10% AGI limitation see article at Congress.gov.  

However, according to the IRS, if common elements of a condominium are owned by a Homeowners Association (HOA), individual members can't claim a casualty loss deduction. Special assessments for capital repairs, even due to disaster damage, are considered contributions to the HOA and aren't deductible.  See IRS.gov article scroll down to Property and casualty loss and go to question#5 

Thus, the $10,500 special assessment for Hurricane Ian repairs is likely not deductible on your federal tax return,

[Phillybilly]

Hi Sabrina,

Thank you very much for your reply. I’ve been doing as much due diligence as my Google skills allow. Our condo ownership is designated as ‘tenants in common’ which leads me to believe our .0825% interest gives us direct ownership which would allow for the deduction. One other thing my Google skills can’t find is concise information on this subject. I might send in an amended filing to see what the irs says on the matter. Thank you again