Let’s say your house burns down. Or it floods. The damage isn’t fully insured, so you’re looking at rebuilding your life without a cushion. Right now, you can deduct uninsured expenses from your taxes if they’re more than 10 percent of your income. If the Republican tax bill passes, you might still be able to. Then again, you might not.
Under the new tax plan, the deduction could only be claimed for those disasters that the president declares a federal emergency.
In 2015, more than 72,000 people filed a casualty or theft deduction, resulting in $1.6 billion in claims, according to the IRS’ Statistics of Income Division. (The IRS lumps casualty and theft deductions together in its count). The proposed change would go into effect January 1, 2018, meaning disaster victims could file one final deduction this year if they experienced a loss that did not receive Federal Emergency Management Agency (FEMA) support.
The tragic fires that blazed through California in recent months, along with Texas’ and Puerto Rico’s horrendous hurricanes, did receive federal emergency declaration, so their victims would still qualify for the deduction under the new tax bill. But most disasters aren’t large enough to attract attention from the White House.
Count it as one more way Republicans want to raise taxes on working people—you know, the people for whom damage to a house is 10 percent of their income—to pay for tax cuts for corporations and the top one percent.
The GOP Tax Scam is a "working definition of a tax boondoggle" for banks, big oil, developers—and it still needs to pass both houses of Congress before it becomes law. Call your members of the House AGAIN TODAY at (202) 224-3121, and tell them you are absolutely furious about the Republican tax bill and they must vote NO.