Is Storm Damage Tax Deductible?
Did you know that if you’ve suffered storm damage, you may be able to claim tax breaks when filing that year? However, the situation in which you can claim a tax break for your Cleveland, TN commercial property are very specific.
What Counts as Storm Damage, Anyway?
Before looking at what is and isn’t tax deductible, let’s take a look at what is and isn’t covered under storm and flood insurance. Believe it or not, this type of storm damage is actually not covered under your regular commercial insurance policy. You can submit a claim to your insurance company for:
• Storm-related flood damage to building structures and interiors
• Loss of furnishings, equipment, and inventory
• Other interior damage and losses caused by primary and not secondary flood damage
However, even with this coverage you may not receive enough from a claim to pay for repairing all damages and replacing all lost property. That’s when a tax deduction comes in.
So When Is Storm Damage Tax Deductible?
If you have to cover repairs or replacements for storm damage out of pocket, that’s when it becomes tax deductible. It doesn’t necessarily refund the entire cost of the losses, but it does at least reduce your tax liability and amount of business taxes owed by deducting from your taxable income.
When filing your taxes you would list this as businesses losses or damages, and itemize the entire amount spent on recovery. However, this is only viable if you took the time to file a claim that itemized all damages. You should also make sure to keep your receipts for any services or purchases, should the IRS choose to audit your returns.
Even if it may not fully defray the losses, even a percentage of savings can help you get back on your feet. Take a detailed inventory of all losses and don’t miss a single penny when filing and claiming business losses due to storm damage.
Visit http://www.SERVPRObradleycounty.com for more information on storm damage.