Victims of the Virginia earthquake on August 23, 2011 may be eligible to receive tax relief on casualty losses due to the earthquake. President Obama has declared the counties of Culpeper, Fluvanna, Goochland, Louisa, Orange, Spotsylvania, and the City of Fredericksburg a federal disaster area.
Individuals in a federally declared disaster area who have suffered casualty losses as a result of the earthquake will have the option of claiming their losses on their federal income tax return either this year or last year. Claiming the loss on an original or amended return for last year will get the taxpayer an earlier refund, but waiting to claim the loss on this year’s return could result in a greater tax saving, depending on other income factors.
Affected taxpayers may claim personal property loss on claims not covered by insurance or otherwise reimbursed.