Updated 12/18/2012 05:00 AM
Money Matters: Helpful tax tips for Sandy victims and volunteers
In addition to FEMA and other assistance, those affected by Hurricane Sandy may also want to start thinking about their taxes. YNN's Shazia Khan filed the following "Money Matters" report.
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Taxes may be the last thing on the minds of those recovering from Hurricane Sandy, but financial experts say now is the time to gather records if you're planning to claim a casualty loss either on your 2012 or 2011 tax return.
"Because this was designated as a federal disaster there's a special benefit that they can amend their 2011 tax returns, file an amended return, claim the casualty loss and get their refund or reduction in taxes on a quicker basis," says Avery Neumark, a certified public accountant with Rosen, Seymour, Shapps, Martin & Co.
But quicker doesn't necessarily mean better. You would need to make a projection for an amended 2011 tax return and a projection for a 2012 one to determine the best tax benefit for the casualty loss. But first, you need to have a certain amount of information for your claim.
"You need to know the basis of the property, you would need to know fair market value before and after, you have to know your insurance reimbursement, or the projected insurance reimbursement. So there is a lot of information that goes into the casualty loss deduction. To put it simply you're not going to get a loss in most cases for every penny that you lost," explains Neumark.
Having reliable records on the particular losses is key, but not always easy for those who may have lost or had their documents restored in the hurricane.
"Take pictures of everything you've lost. You will have perhaps an itemized list dealing with the insurance adjustor. Do the best to your recollection as to acquisition dates, possible costs," says David Sands, a certified public accountant with Buchbinder, Tunick & Co.
And if you'd like to help in the recovery but may not have the time or money, you can donate your vacation or other paid time off to organizations assisting Sandy victims now through the end of 2013.
The IRS says the donated leave will not be included in the employee's income or wages and the employer can claim a deduction on the cash payments made to the relief organizations.
For more information, visit the IRS website.