My vehicle was totaled in Hurricane Harvey. Is this considered an qualified economic loss? can i apply for qualified disaster loss?
Yes, the totaled vehicle would be considered a qualified disaster loss. Yes, you can apply for the loss.
As part of tax reform relief for those affected by natural disasters, you can now deduct your total loss (minus $500 and any amount covered by insurance) along with your usual Standard Deduction, whether you amend 2017 (see below) or file as usual for tax year 2018. This means you’ll be able to claim everything you lost over $500 without having to itemize deductions on your taxes.
If you took a loan or a hardship distribution from your retirement plan to cover disaster-related expenses, here are some issues to consider:
- Loans are not taxable—if you repay them in full within the given time period.
- While hardship distributions generally are taxable, if you live in a federally declared disaster area, the tax reform act now waives the 10% early withdrawal penalty for accounts up to $100,000.
Due to the specifics of each plan, the above is only an overview. For full details, you must contact your plan administrator as soon as possible—some of this relief is date dependent.
NOTE: Your casualty loss is the Blue book value less the amount insurance paid. That's what you need to enter.For FMV, you are asked the FMV before loss: that is where you enter the blue book value. Then it asks FMV after loss: enter 0 there.
More on the loss: