Expanded Disaster Tax Relief
Tax Tip:
Two recent tax law changes strengthen relief for taxpayers affected by natural disasters. Beginning in 2026, personal casualty loss deductions are no longer limited to federally declared disasters. Certain state-declared disasters now may also qualify. Losses outside declared disasters may still be claimed, but only up to the amount of any casualty gains. But you must itemize deductions and additional rules and limits apply.
In addition, the Disaster Related Extension of Deadlines Act ensures that disaster-related filing extensions don’t reduce the time to claim refunds or credits. When the IRS extends filing deadlines due to federally declared disasters, the refund and credit claim period is now extended as well. The law also aligns the automatic IRS payment deadline with any disaster-based filing deadline extension.
This material is generic in nature. Before relying on the material in any important matter, users should note date of publication and carefully evaluate its accuracy, currency, completeness, and relevance for their purposes, and should obtain any appropriate professional advice relevant to their particular circumstances.
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