For those smarter than me:
I understand that I can claim hurricane losses on taxes. I have read the literature on it but do not yet understand it.
Bought the house for $320K, Current MARKET value is $720K per the bank. Current CASH value on my affidavit of loss is $433K, and damage on the affidavit is $198K. Insurance reimbursement for damage $74K. (So many numbers
)
Instructions are to take the "Value of the home" before the damage, and subtract "what someone would pay for the home" after the damage but before it was fixed. Add the insurance settlement, then subtract $100. Whichever the smaller number should be used for the calculated loss. Ummm - what?
Which values do I use? Purchase minus $198K? Market minus $198K? Cash Value minus $198K? Are any of these values what I should use to determine "what someone would pay for the damaged home"? With the repairs came "upgrades" - another variable. Realizing I need to be consistent with one set of numbers - but the ratio of loss is SIGNIFICANTLY different between the three.
Any legit help would be appreciated.
Thanks-
Joe
Tax Question - hurricane loss?
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