Although the deadline for filing an amended return for 2017 (for a hurricane disaster that occurred in 2016), has passed, Congress has provided special relief for casualty losses from Hurricanes Harvey, Irma and Maria. If you were affected by one of these disasters, you may still file a 2018 amended return to deduct your loss.
Note: If you experienced Hurricanes Harvey or Irma, the Bipartisan Budget Act of 2018 expands the relief to disaster areas declared before October 17, 2018.
You have up to three years to submit a regular amended return, but the IRS can take up to 12 weeks to process it.
You will need to go through the steps to qualify for the deduction for disasters, theft, and other property loss or damage. However, the usual limits won’t apply to you because you were affected by a federally declared natural disaster. You'll be able to deduct your total loss, minus $500 and any amount covered by insurance.
- In TurboTax, enter your Description as follows: State, Disaster. For example, if you live in Houston and experienced Hurricane Harvey, under Description you would enter: Texas, Hurricane Harvey.
You may be eligible for relief from some of your state tax obligations. There is a variety of relief; some states may even provide relief to their residents if they have business or other interests in another state. Here is a list to get you started. For the most up-to-date information, check the web pages of the states you’re interested in and FEMA.
Contact the IRS and your state agencies, so they can work with you to come up with a solution. As tempting as it may be to put this off, you should contact them both as soon as possible.
The IRS recognizes that you may reside in an area that was not declared a disaster, yet have stored your records in an area that was. If this is the case, follow these instructions.
The IRS has an extensive list of suggestions for how to establish what you lost.
If you took—or are planning to take—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.
- Hardship distributions generally are taxable. However, if you were affected by the wildfires, you may not have to pay any withdrawal penalty.
- If you took money from a retirement plan to purchase or construct a home but it never happened because of the wildfires, you may be eligible to place the money back ("recontribute to the plan") without penalty.
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.
Please refer to: What if I've been affected by a natural disaster?
- What if I've been affected by a natural disaster?
- What if I have property that was lost or damaged (a casualty loss)?
- I live in a federally declared disaster area, what does that mean for my taxes?
- Where to find disaster relief for your state taxes
- What tax relief can I get if I was affected by Hurricanes Harvey, Irma or Maria?