President Biden Signs Disaster Loss Relief Bill Into Law

On December 12, 2024, President Biden signed the Federal Disaster Tax Relief Act of 2023 into law.  The law provides relief for qualified disaster-related casualty losses.  To assist taxpayers in the wake of extreme weather events that occurred between January 1, 2020, and January 11, 2025, the law eliminates the rule that personal casualty losses must exceed 10% of the taxpayer's adjusted gross income before becoming deductible.  Under the law, each separate casualty loss can be deducted if the value exceeds a $500 floor.  Taxpayers can also claim these qualified disaster deductions above-the-line, meaning that they will not be required to itemize in order to take advantage of the deduction.  The law covers a range of disasters, including Hurricanes Milton and Helene, the wildfires in California and Hawaii, and Hurricane Ian, which hit in 2022.  The FEMA website contains a full list of disasters that qualify. For more information on deducting personal casualty losses in the wake of a qualified disaster, visit Tax Facts Online. Read More: Link to Q8719.  Note: Q is updated.