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Insurance tips for storm victims

August 21, 2008

I was delighted to see that Sanibel, the lovely island on Florida’s Gulf Coast that I was worried about in this earlier post, came through Tropical Storm Fay unscathed.

Many other Sunshine State residents weren’t so lucky.

Gerry Willis, personal finance writer for CNN, has some insurance tips for those storm-battered folks. You can watch a video version here.

Elsewhere on CNN, a Willis article from about a year ago looks at the damages that a lot of homeowner polices don’t cover. That’s always good, although very distressing, to know.

Flimjo also makes that same point in his post, Lessons from Tropical Storm Fay.

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Today’s Tax Tip:
Now here’s my tropical storm tax tie-in. If you don’t have insurance or it doesn’t cover many, any or most of your losses, be sure to take advantage of the casualty loss deduction.

One of the drawbacks of this tax deduction, which is found on Schedule A meaning you have to itemize to claim it, is that you must subtract out all your insurance reimbursements before you can calculate your tax relief.

As the saying goes, it truly is an ill wind that blows no good. In this case, the ill winds might have ripped up your property, but when there’s no or little insurance, a tiny bit of good comes in the form of a potentially larger tax break. Now you can use all of your eligible storm losses to figure out if you can get some money back from Uncle Sam to help you make repairs.

If your storm-ravaged area doesn’t make the major, presidentially declared disaster area list (you can check this IRS page or this FEMA one to see if it does eventually show up), you have to wait until next year to file the claim on your 2008 tax return.

If, however, you’re unfortunate enough to take a hit that gets you the special treatment (blogged about here), you can file an amended return and get that tax money this year.

That presumes of course, you meet all the requirements. You can find out the casualty loss tax rules and filing tips in these documents and Web pages:

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The More Tax Posts tab at the top of this page will take you to, well, more tax posts. You also can search below for a tax topic. 

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TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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