Pending Tax Plan Will Cut Disaster-Related Deductions for Victims

From the Los Angeles Times: Thanks to Trump’s tax plan, victims of disasters large and small are about to get scrooged. CA fire victims will have additional financial problems if the law passes as it is presently.

President Trump and Republican congressional leaders are desperate to “achieve” something — anything — by Christmas. One goal is to deliver a lump of coal to disaster victims. The victims include future burned-out homeowners in wildfires.

It’s one of several whammies hitting middle-class Americans from the GOP tax plan, especially in California and other high-tax states. Among other things, Republicans are set on eliminating the tax deduction for uninsured casualty losses unless a national disaster is declared. People with personal property damaged by disaster currently can deduct the uninsured loss when itemizing on their federal tax returns. Only the dollar amount that exceeds 10% of adjusted gross income can be deducted. But that is quickly reached when a home is destroyed.

In California, we’re regularly ravaged by wildfires, floods and earthquakes. Someday, there’ll be “the big one.” Other states suffer from tornadoes and hurricanes. Also tax-deductible are losses from accidents, thefts and vandalism.

Here is a related article: https://www.reuters.com/article/us-usa-wildfires-insurance/as-california-fires-blaze-homeowners-fear-losing-insurance-idUSKBN1EC1DW

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