ASHLAND, Kan. (KSNW) – A provision in the tax bill going through Congress would have impact on disaster victims by removing all or part of a deduction.
It’s called casualty loss. Accountant Kelly McCarty says her clients have used it to help recover from isolated cases.
“It did make a difference to them when we were able to use it,” said McCarty. “Sometimes it’s a small difference, but every little bit helps.”
The Ashland accountant says the March wild fires that ripped through her community have increased local need for the deduction.
“This year I’ve talked about it with several clients,” she said. “We’re still trying to put together pieces to determine if they’ll be able to use that. I hope that they will be able to take advantage of it, because like I said, every little bit is going to help them.”
To start using the deduction, the damage has to exceed 10 percent of your annual gross income. McCarty says low-income disaster victims tend to hit that requirement faster.
“They don’t have the income there to replace personal assets that have been lost, so they see this as a big asset to them, because they get a break somewhere, and that being on their taxes.”
She says that break can help her clients rebuild.
“They get to use that money, those tax dollars, to turn around and actually replace a bed or dinnerware or whatever it may be. Help replace a roof.”
The House version of the tax bill removes the deduction entirely. The Senate version keeps it only for federally declared disasters. The bill’s differences are currently being worked out in conference
Congressman Roger Marshall told KSN in a statement, “Either of these provisions wouldn’t go into effect until 2018 and would entirely leave out those impacted by the Clark County fires this year. I think it is important to keep the deductions for federal disasters.”
The bill would affect victims of disasters going forward.
KSN also reached out to Senators Jerry Moran and Pat Roberts about what they expect the final bill to look like.
Senator Roberts said in a statement, “While I want to do everything possible to help those suffering from the fires, conference committee negotiations are still underway, and it is too soon to know what will be retained in the final bill.”
Senator Moran did not comment.