Does Storm-Related Damage Have a Place on Your Business Tax Return?
Business owners must think of innovative ways to meet customer demands. There is, however, one variable that can throw a monkey wrench into the workings of any company: severe weather. As you probably know, storms and other natural disasters can bring your company to a standstill. If your business has sustained storm damage, you may be able to deduct some of it on your annual tax return.
Determine the Source of Your Business Damage
To know whether damage to your Hixson, TN business is tax deductible, you must first determine the source of the damage. Damage from the following types of natural disasters are often deductible:
When determining whether damage is caused by a storm, you must look for sources of other possible damage. For example, failure to properly maintain your business before the storm hit may render your organization ineligible to list it as a deductible expense.
Consider Whether Your Insurance Policy Covered the Damage
The next part of the analysis involves your insurance. If your commercial policy covered storm damage, you likely cannot deduct it on your tax filing. If, on the other hand, your insurer did not pay for the damage, you may be able to list it as a deduction. You can also usually list the difference between actual damage and the amount your insurer paid as a deduction. If you failed to file an insurance claim that would have otherwise been covered, you are probably ineligible to claim the damage as a deduction, though.
Virtually all business eventually sustain some type of storm damage. While relying on insurance to help control costs is a good idea, you must have a full-throttled strategy to ensure business continuity. A restoration service can likely help to return your company to its pre-storm condition. Then, you may be able to deduct some storm-related expenditures on your business tax return. Call (423) 326-1406.