; Tax Ed Programming: Disaster Losses & Related Tax Rules | Conferences | AgRisk Library


Conference Name Tax Ed Programming: Disaster Losses & Related Tax Rules

Adam Kantrovich, Ruby Ward, and JC Hobbs


The National Farm Income Tax Extension Committee/Ruraltax.org is working with USDA to provide material and programming surrounding tax education and asset protection. This 30-minute presentation will focus on Disaster Losses and Related Tax Rules and provide the audience with resources to assist them in their programming needs.

The dollar value of property losses due to fires, floods, tornadoes, earthquakes, lightning, freezes, etc. can be substantial. Federal income tax regulations often provide relief by allowing deductions for losses of business-use property. The passage of the Tax Cuts and Jobs Act of 2017 resulted in significant modifications to the deductibility of losses involving personal-use property. In order to deduct a loss for personal-use property as a Miscellaneous Itemized Deduction on Schedule A on Form 1040, the area in which the loss occurred must be declared a federal disaster area. These new rules are in effect for losses that occur beginning January 1, 2018, and ending December 31, 2025. This fact sheet describes losses to property, the process used to determine if you have a deductible loss, how insurance proceeds and cost share benefits are treated, and how to reconstruct records to document a loss. Examples help explain the rules that apply to property found on the farm including buildings, machinery, livestock, feed, and supplies, as well as the home and its contents and personal vehicles. A list of related Internal Revenue Publications is included at the end of this fact sheet. These publications provide additional information covering disaster losses.