If a taxpayer suffers a loss attributable to a disaster in an area subsequently declared a disaster area,the casualty loss may be deducted in the year preceding the year in which the loss actually occurs.

Question

Quizplus · Accepted Answer

This is true according to the IRS guidelines for casualty losses. A taxpayer can choose to deduct the loss in the tax year preceding the disaster year by filing an amended return or deduct it in the year of the disaster.

If a Taxpayer Suffers a Loss Attributable to a Disaster