Among the devastation recently caused in Gulf Coast communities, massive amounts of timber and trees were lost as a result of Hurricane Michael. The IRS recognizes landscaping and trees as a part of your property, even if you purchased and planted them at a different time than when you purchased your property. So, to mitigate the loss of trees on your property after hurricane damage, you may be entitled to a casualty loss deduction on your federal tax return.
Resources and Information
Below, we have assembled a few resources that may help to inform you about tree and timber casualty losses in light of Hurricane Michael.
- The National Woodland Owners Association (NWOA) recently released an article about casualty losses related to timber and landscape trees that could be available to you. The NWOA examines how to determine your property’s original basis, discusses how and when to claim a casualty loss and provides examples of casualty loss scenarios.
- The IRS has answered common questions from disaster victims specifically about casualty losses. You can access an excerpt from the IRS website here to learn more about how to determine and compute casualty losses from damaged trees on personal-use residential property.
- The National Timber Tax Website provides an overview of what property owners should consider when looking to take advantage of a casualty loss for trees or timber, including unmerchantable timber, salvaging damaged timber and involuntary conversions.
Contact Warren Averett for Specific Information Pertinent to You
Not every situation is covered in the information above, and each property owner’s specific circumstance will be different, so please contact your Warren Averett advisor to discuss your precise condition and courses of action.
Warren Averett has weighed in and produced its own resources to aid and educate the victims of Hurricane Michael. You can access more information about casualty losses in light of Hurricane Michael and other relevant resources in Warren Averett’s Insights blog.