Flooding and the resulting damage to properties is a topic on many Florida homeowners’ minds. Rising sea levels and frequent hurricanes mean an increasing number of homes are at risk from flood damage. More and more homeowners have to face the ever-increasing odds of their homes suffering damage due to natural disasters.
According to the Tampa Bay Times, around 114,000 additional homes in Florida are at risk of flooding in a severe storm than the current figures from the Federal Emergency Management Agency (FEMA) would suggest. Tampa is cited as the second-most affected city in Florida, behind Cape Coral.
While homeowners suffering damage from storms only have limited tax breaks available currently, proposed legislation dealing with flood-prone areas and tax breaks could provide property owners with opportunities for tax breaks in the future.
Homeowners do not only face uncertainty when it comes to flood-prone areas and tax ramifications but can also have a hard time recovering payment from their insurance company after suffering damage in a natural disaster. If your insurance company is delaying your claim or refusing a payout altogether, contact St. Petersburg property damage attorney Jonathon W. Douglas to learn more about your legal rights. Schedule a free consultation with our property claims team today: (727) 381-2300.
Getting a Tax Break for Flood Damage Can Be Tough
Florida property owners can no longer enjoy some of the tax benefits they were previously entitled to when their property suffered damage from natural disasters such as hurricanes and flooding. A recent provision in the Tax Cuts and Jobs Act means that homeowners now face a limit on the deductions they can claim for any property damage.
Before this new tax law came into effect in 2018, taxpayers could claim property damage that was not covered by their insurance company, provided the damage happened as a result of natural disasters such as storms and flooding. Now, taxpayers suffering property damage due to a natural disaster such as flooding or storms are not able to receive tax deductions unless their specific area and county is declared a federal disaster area after a major storm or flooding event.
Getting a tax break may be challenging. However, it is not impossible. Homeowners can still claim this particular deduction if the natural disaster that caused their property damage is a federally declared disaster such as a major hurricane, and providing the total losses amount to more than ten percent of the homeowner’s gross income.
Net Operating Losses
Homeowners whose property damage due to a flood exceeds their income could in some cases claim a net operating loss, a negative amount of income, on their tax return. Property owners can carry the loss back to a previous year or use it for next year’s tax return, depending on their circumstances.
The benefits for homeowners claiming a deduction on the past year’s return mean they could see a refund of taxes sooner, potentially providing them with urgently needed funds for repair expenses. Property owners who have already filed their tax return for last year still have the possibility to claim the deduction by filing an amended return with Form 1040X.
Tax Filing Extensions
While not a tax break as such, a filing extension can provide some help to homeowners affected by flooding and other damages. If the event that caused the damage to your home is a federally declared disaster, the Internal Revenue Service can postpone the deadline for filing taxes and making payments for those affected by the disaster. In this circumstance, the IRS may also waive penalties for late filing or late payments, provided homeowners file their returns and make any payments before the extended deadline.
If you suffered damage due to flooding or storms, dealing with the tax implications and insurance companies can be challenging. However, if you are struggling to get what you deserve and need to repair your property, help is available. Contact our property claims team for advice and help today regarding all of your legal options.
New Legislation Could Provide a Tax Break to Homeowners
When it comes to flood-prone areas and tax breaks, homeowners could be getting a welcome boost sooner rather than later. Bills potentially providing a tax break to Florida homeowners in flood zones are currently under consideration by the Florida legislature. Under this proposed new legislation, homeowners who elevate their properties to prevent damage from flooding would be exempt from paying tax on the added value of their improved home.
This new legislation could significantly help homeowners in coastal areas throughout Florida, especially in the Tampa Bay area where many properties are located in flood-prone areas.
At this time, homeowners who undertake the work to elevate their properties above the base flood elevation level are required to pay higher taxes on their improved and reassessed property.
The new law is designed to not only help homeowners located in coastal zones but would also have an impact on non-waterfront homes located in special flood hazard areas. If the proposed legislation gains approval of the Florida legislature, it is due to be voted on in the general election in November 2022 and, if approved by voters, could become law in early 2023.
St Petersburg Property Damage Attorney Jonathon W Douglas Can Help
Flooding can cause devastating damage to your property and necessitate urgent, extensive, and costly repairs. Getting your due from an insurance company can be a challenging and lengthy endeavor. If your insurer is giving you the run-around and either delaying, underpaying, or denying your claim, do not hesitate to contact us for help. An experienced and knowledgeable property damage attorney can help you receive the coverage needed to repair your property.
Attorney Jonathon W. Douglas has experience in dealing with some of Florida’s largest insurers and is committed to helping homeowners who are struggling to recover an adequate settlement.
We understand that homeowners who have incurred flood damage may be facing steep repair bills and mounting financial responsibilities. We work on a no-win-no-fee basis so there is no financial risk for you when we take on your case.
Call St. Petersburg property damage attorney Jonathon W. Douglas today to schedule a free consultation with one of our property claims team members: (727) 381-2300.