Monday, October 27, 2008

What if Your House Did Not Burn Down?

 What if Your House Did Not Burn Down?

Recent fires affected large geographic areas, but did not cause widespread damage to buildings, thankfully. BUT ARE THERE OTHER LOSSES TO BE DEALT WITH?

Many homeowners were ordered to evacuate. These homeowners and others may have experienced smoke damage to their property.

Evacuation costs may be covered under a homeowner, condo owner or renter fire policy. They would be subject to deductibles. They do not generate a tax deduction for homeowners related to evacuation from a personal real estate property. Costs of evacuation from a business property would be deductible as "necessary" expenses related to the fire.

Smoke damage is also covered by most insurance policies. Again, subject to the normal deductibles.

Damages that are covered by insurance but are not claimed are not allowed as deductions on a tax return.