Were either of you affected by a natural disaster in 2020

[No_Names_Please]

The question prompt states to "Select Yes only if you were affected by a federally declared natural disaster that was declared before February 19, 2020. "  Clicking on the "which natural disaster are allowed" link, I confirmed that  New Jersey TROPICAL STORM ISAIAS (DR-4574-NJ) was a Major Disaster Declared for my county.  I did further search  IRS publication 584 Casualty, Disaster, and Theft Loss Workbook (Personal-Use Property) which pointed to Form 4684, Casualties and Thefts,.  The definition of a Qualified Disaster Loss for the 4684 instructions appear to be updated to extend the loss from Jan 1 2018 and Feb 18 2020 to -  A qualified disaster loss is now expanded to include an individual's casualty and theft of personal-use property that is attributable to a major federal disaster that was declared before February 26, 2021, by the President under section 401 of the Stafford Act and that occurred on or after December 28, 2019, and on or before December 27, 2020, and continued no later than January 26, 2021. However, this change does not include those losses attributable to a major disaster that has been declared only by reason of COVID-19.

IDoes this mean I should fill out form 4684 for a loss that occurred in August 2020?

[Cynthiad66]

No.  Although, effective March 13, 2020, the COVID-19 pandemic is a qualifying natural disaster, that question is referring to casualty losses to property due to hurricanes and wildfires in areas specifically designated as natural disaster areas?   

[No_Names_Please]

My question was not about COVID as a natural disaster but for Tropical storm Isaias which was declared a major disaster declaration.  IRS publication instructions for form 4684 where update Feb 2021.  The update includes - 

Qualified disaster loss.

A qualified disaster loss is an individual’s casualty or theft loss of personal-use property that is attributable to a major federal disaster declared by the President under section 401 of the Stafford Act in 2016, as well as from Hurricane Harvey, Tropical Storm Harvey, Hurricane Irma, Hurricane Maria, or from the California wildfires in 2017 and January 2018.

A qualified disaster loss includes an individual's casualty or theft of personal-use property that is attributable to a major federal disaster that was declared by the President under section 401 of the Stafford Act if declared on or after January 1, 2018, and before February 18, 2020, if that loss occurred before January 19, 2020. However, this change does not include those losses attributable to California wildfires in January 2018 (which received special relief in 2018).

A qualified disaster loss is now expanded to include an individual's casualty and theft of personal-use property that is attributable to a major federal disaster that was declared before February 26, 2021, by the President under section 401 of the Stafford Act and that occurred on or after December 28, 2019, and on or before December 27, 2020, and continued no later than January 26, 2021. 

Does this mean the forms currently provided in TurboTax Deluxe for 2020 tax year to be updated or did I miss understand the intent of the update?

[PattiF]

Yes, you should fill out Form 4684 if you had a loss from Tropical Storm Isaias.

The form is not available yet in its final form. It is schedule to be ready to use on 2/25/2021.

Here is a list of form availability from the IRS:  IRS Forms Availability

[dingding3022]

I was also inquiring about Tropical Storm Isaias.  On August 4, 2020, my 500 ft. gravel driveway collapsed during this storm because of the amount of water.  It was not covered by my home owners insurance, so I had to have it replaced.  I replaced it with asphalt because I was told it could possibly happen again if there came another storm.  The driveway is my only way to access my home (other than driving alongside the driveway on grass then driving across the the front yard to get to the garage) , so I had to have it repaired because it interfered with my deliveries .  The driveway replacement  cost $11,000.  With that being said, I did see that a declaration was issued on February 4, 2021 (FEMA-4583-DR, Maryland Diaster Declaration for Incident Period August 3, 2020 - August 4, 2020).  I did reach out to our Calvert County Division of Emergency Management  and was told the following regarding the declaration:  "President Biden did approve a disaster declaration for TS Isaias; however, there are two types of declarations-- Public Assistance and Individual Assistance. The declaration we received approved the state for Public Assistance which covers repairs to public infrastructure such as roads and bridges. Unfortunately, there was not enough damage to qualify for Individual Assistance, which provides funding for repairs to private property through programs such as the IHP."  Would I still be eligible to receive some type of tax relief when I do my tax return?  If so, how would I go about accomplishing that task?  Thanks in advance for any assistance I'm able to get regarding this matter.

[ReneeM7122]

Yes, you can qualify for a natural disaster relief on your taxes.  

For taxpayers who were affected by a federally declared disaster, here’s how to determine if you are eligible for relief:

• Individuals whose principal residence and any business entity whose place of business is located in counties designated as federally declared disaster areas.
• Any individual who is a relief worker assisting in a covered disaster area, regardless of whether they are affiliated with a recognized government or philanthropic organizations.
• Individuals whose principal residence and any business entity whose principal place of business is not located in a covered disaster area but whose records necessary to meet the filing or payment deadline are maintained in a covered disaster area.
• Estates or trust that have tax records necessary to meet filing or payment deadlines in a covered disaster area.
• Any spouse of an affected taxpayer with regard to a joint return of the husband and wife.

Here is a TurboTax article about disaster relief.

Here is an IRS link about natural disaster relief

And an IRS video for victims of natural disasters.

@dingding3022

[jpmrgst]

So form 4684 has been updated in TTax (form view no longer instructs to delay filing pending IRS approval of forms).  But the Wages & Income section still reads ... "Select Yes only if you were affected by a federally declared natural disaster that was declared before February 19, 2020. "  Will this section be updated to read ... before February 26, 2021 ...?  If so, when ?  If not, how do I answer the question ... Yes or No to having been impacted by a 2020 disaster (Hurricane Laura, Aug. 27, 2020).

[dingding3022]

Thank you for your reply.  Turbotax has updated the forms, however, I too have the same question as someone else.  The Wages & Income section still reads  "Select Yes only if you were affected by a federally declared natural disaster that was declared before February 19, 2020. "  Will this section be updated to read "before February , 2021?   If so, when ?  If not, how do I answer the question if I was affected by Isaias on August 4, 2020?  I have been constantly checking TT for updates but it says my software is up to date.  Thank you 

[ReneeM7122]

@dingding3022 Answer yes, since you are eligible to qualify for a natural disaster relief on your taxes, and the important thing is to transfer that information to your tax return.  

For taxpayers who were affected by a federally declared disaster, here’s how to determine if you are eligible for relief:

• Individuals whose principal residence and any business entity whose place of business is located in counties designated as federally declared disaster areas.
• Any individual who is a relief worker assisting in a covered disaster area, regardless of whether they are affiliated with a recognized government or philanthropic organizations.
• Individuals whose principal residence and any business entity whose principal place of business is not located in a covered disaster area but whose records necessary to meet the filing or payment deadline are maintained in a covered disaster area.
• Estates or trust that have tax records necessary to meet filing or payment deadlines in a covered disaster area.
• Any spouse of an affected taxpayer with regard to a joint return of the husband and wife.

Here is a TurboTax article about disaster relief.

Here is an IRS link about natural disaster relief

And an IRS video for victims of natural disasters.

@jpmrgst

[No_Names_Please]

I have a natural disaster loss which was determined using Form 4684.   I would normally be using standard deduction, however there is an exception noted in IRS 1040 instructions Exception 4—Increased standard deduction for net qualified disaster loss.  If you had a net qualified disaster loss and you elect to increase your standard deduction by the amount of your net qualified disaster loss, use Schedule A to figure your standard deduction. Qualified disaster loss refers to losses arising from certain disasters occurring in 2016 and subsequent years. See the Instructions for Form 4684 and Schedule A, line 16, for more information.  

Going to the instructions for Schedule A line 16 -1. List the amount from Form 4684, line 15, on the dotted line next to line 16 as "Net Qualified Disaster Loss," and attach Form 4684.
2. List your standard deduction amount on the dotted line next to line 16 as "Standard Deduction Claimed With Qualified Disaster Loss."

3. Combine the two amounts on line 16 and enter on Form 1040 or 1040-SR, line 12

I see that instruction 1 is captured on the TTax form Sch A line 16.  However, Instruction 2 is not captured on TTax form Sch A line 16 yet instruction 3 is carried out on TTax form 1040 line 12.  Will TTax be updating Sch A line 16 to include instruction 2?  It took time to figure out why the TTax form Sch A line 17 did not match line 12 on Form 1040.  Not until you go through the IRS web site do you find what I believe is the correct answer.  

[ReneeM7122]

Form 4684 is available.  If you have downloaded or desktop software, please run an update.  

To enter Casualty and Theft Form 4684 in TurboTax:

1. Go to the "Federal Taxes" tab
2. Click on "Deductions & Credit" 
3. Scroll down to "Other Deductions and Credits" and click on "show more." Click "Start" next to "Casualties and Thefts" continue to follow the onscreen guide.

You can also type casualties and thefts in the search box and then Jump to casualties and thefts.

Use this Link for more information 

Tax Victims of Disaster Loss

Who May Be Entitled to Relief

For taxpayers who were affected by a federally declared disaster, here’s how to determine if you are eligible for relief:

• Individuals whose principal residence and any business entity whose place of business is located in counties designated as federally declared disaster areas.
• Any individual who is a relief worker assisting in a covered disaster area, regardless of whether they are affiliated with a recognized government or philanthropic organizations.
• Individuals whose principal residence and any business entity whose principal place of business is not located in a covered disaster area but whose records necessary to meet the filing or payment deadline are maintained in a covered disaster area.
• Estates or trust that have tax records necessary to meet filing or payment deadlines in a covered disaster area.
• Any spouse of an affected taxpayer with regard to a joint return of the husband and wife.

@No_Names_Please