A Los Angeles Times Special Report : Coping With The Quake : Recovering From Disaster, Preparing for the Future : Homeowners May Be Eligible for Tax Relief on Damaged Dwellings
Homeowners whose dwellings were damaged by Monday’s earthquake and resulting aftershocks may be eligible for some tax relief.
Insurance payouts for quake damage are free of federal income taxes, even if they amount to more than the price that a homeowner paid for the house, provided they come in areas that President Clinton officially designates as a disaster zone, said Jack W. Anderson, a certified public accountant in Fountain Valley.
And the value of damage not covered by insurance can be written off as a loss on income taxes, he said.
The county assessor could prove helpful as well. Assessors have the power to reassess property damaged or destroyed by the earthquake. A lower assessment can result in lower property tax bills.
Under California law, property owners who incur at least $5,000 in damage qualify for a reassessment. Many homeowners applied for deductions recently after brush fires swept through Malibu and Laguna Beach.
Neither Los Angeles County Assessor Kenneth Hahn nor Orange County Assessor Bradley L. Jacobs could be reached for comment Monday, a county holiday, about plans for revaluing quake-damaged properties.
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