Saturday, December 29, 2012

INCOME TAXES AND DISASTERS – 2012 YEAR-END SUMMARY



INCOME TAXES AND DISASTERS – 2012 YEAR-END SUMMARY

Was 2012 a big year for disasters? Well it depends on how you look at it. There were 47 declared disasters in 2012. Fourteen years, starting with 1953 exceeded the 47 count. Ten of the fourteen fell in the period between 2002 and 2011. Three occurred between 1996 and 1999. The first year that exceeded 47 declarations was 1972.

Of the 47 incidents in 2012, twelve of them relate to twelve states affected by the October / November Hurricane Sandy (also referred to Super Storm Sandy).

The first 2012 declaration was actually a delayed declaration for a November 30, 2011 incident (Severe Storm And Snowstorm for Massachusetts).

We wish all those who experienced these events, as well as the other significant events that were not declared disaster areas and anyone who had an individual loss, all the best in their recovery process.

Below is a list of 2012 disaster declarations taken from the www.fema.gov/disasters, to get more details, click on the incident number or the incident description.

2012 Disaster Declarations for 2012 from FEMA.Gov
Incident Number
Declaration Date
State
Incident Description




12/19/2012
Massachusetts
12/5/2012
District of Columbia
11/28/2012
New Hampshire
11/27/2012
Alaska
11/27/2012
West Virginia
11/26/2012
Virginia
11/20/2012
Maryland
11/16/2012
Delaware
11/3/2012
Rhode Island
11/3/2012
Utah
10/30/2012
Connecticut
10/30/2012
New Jersey
10/30/2012
New York
10/18/2012
Florida
9/25/2012
Washington
9/21/2012
Alabama
8/29/2012
Mississippi
8/29/2012
Louisiana
8/24/2012
New Mexico
8/22/2012
Oklahoma
8/20/2012
Ohio
8/2/2012
Wisconsin
8/2/2012
Maryland
8/2/2012
Montana
7/31/2012
District of Columbia
7/27/2012
Virginia
7/23/2012
West Virginia
7/19/2012
New Jersey
7/6/2012
Minnesota
7/3/2012
Florida
6/28/2012
Colorado
6/22/2012
Vermont
6/15/2012
New Hampshire
6/14/2012
Oklahoma
5/24/2012
Kansas
4/18/2012
Hawaii
3/22/2012
West Virginia
3/16/2012
West Virginia
3/16/2012
Tennessee
3/9/2012
Indiana
3/6/2012
Kentucky
3/5/2012
Washington
3/2/2012
Oregon
2/2/2012
Alaska
2/1/2012
Alabama
2/1/2012
Utah




2012 Disaster Declarations for 2011 from FEMA.Gov
1/6/2012
Massachusetts (11-30-2011 Inceident - delayed declaration)


Here is a list of prior blog entries that have been organized by significant category.


CATEGORY

Date Posted

BLOG TOPIC TITLE





DISASTER RECOVERY TOPICS
DISASTER TOPICS

10/7/2011

THE PROCESS OF RECOVERY – POR
DISASTER TOPICS

5/19/2011

WHAT ARE THE INCOME TAX ISSUES IN THE PROCESS OF RECOVERY
YEAR-END CONSIDERATIONS
YEAR-END CONSIDERATIONS

12/18/2012

2012 YEAR-END RECOVERY TAX CONSIDERATIONS
EXTESNIONS

12/12/2012

DO YOU NEED AN EXTESNION OF TIME TO REPLACE OR REPAIR PROPERTY DAMAGED IN A DISASTER?
DISASTER RECOVERY TOPICS 
DISASTER RECOVERY PLANNING

9/9/2012

PLANNING FOR FAMILY AND HOME DISASTER RECOVERY
DISASTER PLANNING

5/27/2010

WHAT IS DISASTER RECOVERY SECURITY?
DEFINITION OF A DEDUCTIBLE LOSS
DEFINITION OF A CASUALTY - MUDSLIDES

10/12/2011

MUDSLIDE – IS THIS A CASUALTY LOSS? 
DEFINITION OF A CASUALTY

6/9/2012

WHAT IS A CASUALTY?
DOCUMENTATION


DOCUMENTATION

4/2/2009

DOCUMENTATION
DETERMINING THE AMOUNT OF A LOSS
A GAIN OR A LOSS

11/21/2011

WAS IT A CASUALTY LOSS OR AN INVOLUNTARY CONVERSION GAIN
A GAIN - APPRAISAL METHOD VALUATION

6/18/2008

FIGURING THE LOSS – MARKET VALUE METHOD
A GAIN - COST OF REPAIRS VALUATION

5/27/2011

Why is the Cost of Repairs Method of Loss Valuation not the one to use?
A GAIN - COST OF REPAIRS VALUATION

7/16/2008

LOSS VALUATION COST OF REPAIRS METHOD
REPLACEMENT DECISIONS

A GAIN - BUY OR REPAIR

6/12/2008

SHOULD YOU BUY A REPLACEMENT HOME?
IMPLICATIONS OF MAKING A POOR DECISION
BAD DECISIONS

12/29/2010

WHY CAN’T IT JUST BE DONE RIGHT THE FIRST TIME?
BAD DECISIONS

7/6/2012

PERILS OF DISASTER TAX REPORTING ERRORS
A GAIN OR A LOSS - BAD DECISIONS

9/12/2011

DON'T RUSH TO DEDUCT!
PARTIAL LOSSES 
PARTIAL LOSSES

10/27/2008

WHAT IF YOUR HOUSE DID NOT BURN DOWN? 
PERSONAL PROPERTY LOSSES
PERSONAL PROPERTY LOSSES

7/21/2008

PERSONAL PROPERTY LOSSES – DIFFICULT SITUATION ORNO PROBLEM
PERSONAL PROPERTY LOSSES 
Order to Demolish

11/20/2012

HOW DOES AN ORDER TO DEMOLISH AFFECT YOU TAX STATUS?
CARRY BACK OF CURRENT YEAR DISASTER LOSS
CARRY BACK OF CURRENT YEAR DISASTER LOSS

1/26/2009

DEADLINE FOR DISASTER FILINGS TAX FILING DEADLINES
CARRY BACK OF CURRENT YEAR DISASTER LOSS

3/29/2010

DON'T MISS THE APRIL 15TH DEADLINE TO FILE AND AMENDED RETURN
CARRY BACK OF CURRENT YEAR DISASTER LOSS

5/26/2010

DEADLINE FOR THOSE WHO EXPERIENCED THE APRIL 4, 2010
CARRY BACK OF CURRENT YEAR DISASTER LOSS

3/30/2012

DON'T MISS THE APRIL 17TH DEADLINE TO FILE AND AMENDED RETURN
PUBLIC ADJUSTERS


PUBLIC ADJUSTER FEES

2/9/2012

HOW DO YOU TREAT PUBLIC ADJUSTER’S FEES
REPORTING INSURANCE PROCEEDS - A GAIN 
REPORTING INSURANCE PROCEEDS - A GAIN

8/24/2012

WHAT... YOU DID NOT REPORT INSURANCE PROCEEDS
REPORTING INSURANCE PROCEEDS - A GAIN 
BUSINESS LOSSES

3/29/2010

ARE BUSINESS LOSSES DIFFERENT?
OTHER ISSUES AND CONCERNS
New Taxes for 2013

9/17/2012

NEW TAXES FOR 2013 COULD AFFECT YOUR DECISIONS
IRS Audit Tips

10/28/2012

TWO AUDIT TIPS THAT COULD SAVE YOU A LOT OF STRESS
DISASTER DECLARATIONS

DISASTER DECLARATIONS

12/19/2008

LARGE EVENTS MAY NOT GET FEDERAL ASSISTANCE DISASTER DECLARATION
DISASTER DECLARATIONS

11/17/2012

2012 DISASTERS - MORE THAN “SANDY”
DISASTER DECLARATIONS

11/21/2012

FROM IRS WEBSITE, “AROUND THE NATION” NOVEMBER 21, 2012:
DISASTER DECLARATIONS

11/5/2012

HURRICANE SANDY - SCHEDULE OF PROFESSIONAL EDUCATION WEBCASTS FOR CPAS
DISASTER DECLARATIONS

11/2/2012

DOES YOUR LOSS QUALIFY AS A DISASTER?
DISASTER DECLARATIONS

10/30/2012

HURRICANE SANDY – FEMA DISASTER DECLARATIONS
DISASTER DECLARATIONS

10/29/2012

HURRICANE SANDY – NO DISASTER DECLARATION YET
DISASTER DECLARATIONS

3/18/2012

WINTER 2012 FEDERAL DISASTER DECLARATIONS  
DISASTER DECLARATIONS

11/19/2009

WHAT DISASTER?
DISASTER DECLARATIONS

7/7/2009

IT'S "YOUR" DISASTER 
DISASTER DECLARATIONS

6/6/2009

IS THE SANTA BARBARA JESUSITA FIRE TREATED DIFFERENT



A comprehensive discussion of disaster recovery topics was posted in 2011. The contents of the “Process of Recovery” sections are listed below. Use this along with the above blog entries.


THE PROCESS OF RECOVERY - INCOME AND PROPERTY TAXES
P. of R. Part 1
1

Tools for Recovery
2

Income Tax Laws Affect People Who Experience a Loss
3

Insurance vs. Other Support
4

Cost Basis
5

Documenting – A gain or a loss?
6

Tax Reporting Follows the Insurance Proceeds
P. of R. Part 2
7

No Gain or Loss
8

A Loss
P. of R. part 3
9

A Gain
10

Time Period to Complete Qualified Replacements
11

Statute of Limitations
P. of R. Part 4
12

“Qualified Replacement Personal Use Property”
13

Sale of Residual Land / or Hold for Later Sale
14

Insurance vs. Income Tax
P. of R. Part 5
15

Things Can Get Worse
16

Changes and “Corrections”
17

Part Personal Use / Part Business
P. of R. Part 6
18

Affect of Changing Use After Replacement
19

ALE – Additional Living Expense
20

Experts – Tax reporting
P. of R. Part 7
21

Law Suits, Expenses Incurred
22

Mortgage Interest
23

IRS Audits – Good Faith Reporting
24

Property Tax Issues
P. of R. - Disasters Part 8
25

Tax Code Provisions Available in Federal Disaster Areas – Primary Residence:

Best wishes to all those involved in the recovery process, whether from a major disaster, an undeclared disaster or a single loss event. At the offices of JOHN TRAPANI, Certified Public Accountant, we are available to assist you with the complexities of the tax issues related to recovering from a physical catastrophic loss.

For those who are located in one of the twelve states that declared a disaster area as a result of Hurricane Sandy, also called Super Storm Sandy, see the tab at the upper right corner at the top of the blog.



All rights to reproduce or quote any part of the chapter in any other publication are reserved by the author. Republication rights limited by the publisher of the book in which this chapter appears also apply.


JOHN TRAPANI


Certified Public Accountant


2975 E. Hillcrest Drive #403


Thousand Oaks, CA 91362


 (805) 497-4411       E-mail John@TrapaniCPA.com




Blog: www.AccountantForDisasteRrecovery.com


                                                                                                                      
                           It All Adds Up For You                     


  

This material was contributed by John Trapani. A Certified Public Accountant who has assisted taxpayers since 1976, in analyzing and reporting transactions of the type covered in this material.  

Internal Revenue Service Circular 230 Disclosure
This is a general discussion of tax law. The application of the law to specific facts may involve aspects that are not identical to the situations presented in this material. Relying on this material does not qualify as tax advice for purpose of mounting a defense of a tax position with the taxing authorities
The analysis of the tax consequences of any event is based on tax laws in effect at the time of the event.

This material was completed on the date of the posting
© 2012, John Trapani, CPA,