Natural Disaster Financial Recovery- Tax and Insurance Tips

Our hearts and prayers go out to all those affected by Hurricane Irma and other disasters. Our headquarters city of Jacksonville was one of the worst hit in Florida, and we are so sorry for our many friends and clients who were impacted, some very severely. The Camarda family had some expensive damage, but nothing like the others we have heard about. Please call or email if there is anything we can help with.

I am very pleased to report that our disaster recovery system – yes, we do have one, have had for many years, and Kim did a wonderful job designing it – worked very well as planned. Our entire team was able to stay in touch, in the wind and the rain and the flooding and the no power – to make sure our vital functions and client duties were tended to. We got some good ideas for improvement, but all went smoothly.

If you have been impacted by this or other disasters, there are a few financial facts you need to know.

The first is about insurance. While policies are written very tightly, there is often more wiggle room than people realize, so don’t be afraid to press your claim even if you are told at first it is not covered. Second, when faced with an overwhelming number of claims like now, companies are prone to cut deals to get them off their desks. Work this to your advantage, but make sure your settlement is fair. Finally, you should know that independent adjusters – who will work for you for a commission off the claim they get you –are available to keep companies honest. If you think you are getting screwed, often even the threat of hiring an independent will get them to change their tune.

The second tip is about tax deductions for casualty losses like those caused by hurricanes, as well as thefts and other sudden causes. These can apply to real estate, cars, boats, pretty much you name it. Like all things tax these get complicated fast, but the essential concept is if you sustain a loss beyond a threshold amount like 10% of your adjusted gross income, you can get a sometimes very big write off, and save a ton of tax. IRS Publication 547 is a good source of information. While you should discuss this with your tax preparer, I suggest you bone up first to make sure you get good advice, as many preparers may not be completely up to speed on this.

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