EA CPE Trains You to Make Taxpayer Disasters Into Tax Benefits

July 22, 2011 by  Filed under: Taxes 

People who have experienced unexpected disasters may find some relief when filing their income tax returns. These individuals can obtain those tax benefits from using the services of an enrolled agent tax preparer. Since there is some extra paperwork involved, enrolled agents provide a community benefit by quickly educating taxpayers in a disaster area about the records to retain. The need for providing this information represents an opportunity to promote the valuable expertise available from an enrolled agent.

An unforeseen casualty loss is an itemized deduction on the tax return of the person incurring the loss. For major disasters, there are some other tax advantages. EA CPE teaches the IRS guidelines for disaster deduction claims.

The destruction of property must occur from a sudden, unexpected, or unusual event. Normal wear does not count as a casualty loss. The disaster can have natural or man-made causes. An event that is reasonably expected or preventable is not eligible. That excludes termite damage and oak wilt disease.

Figuring the deduction for a casualty loss is not easy. In order to conduct the calculation correctly – and not become entirely frustrated – a taxpayer is wise to turn the process into an enrolled agent job. The IRS sets two limits for casualty losses. The first is that the loss is reduced by $100. This reduction applies to any single loss event, not to each piece of property involved in the occurrence. Then, the deductible loss is limited to the amount that exceeds 10 percent of the taxpayer’s adjusted gross income.

Of course, losses do not include any reimbursement received from insurance claims. Many taxpayers, however, find that their insurance does not cover the full amount of loss from a disaster or theft. Enrolled agent courses address completing the extra forms submitted with a tax return claiming a disaster loss.

Regions the are declared disaster areas by the US president incur extra tax considerations. In such cases, enrolled agent training is especially valuable at getting victims faster help from the IRS. Taxpayers in federal disaster areas can typically claim a loss as if it had happened in the previous year. This is accomplished by amending last year’s tax return to claim the loss. Taxpayers have until the due date of the tax return for the actual disaster year.

Taking tax deductions for disaster and theft losses involves some extra trouble. But it is often worth the effort. The burden is considerably alleviated by the high quality of tax service available from enrolled agents.

IRS Circular 230 Disclosure

Pursuant to the requirements of the Internal Revenue Service Circular 230, we inform you that, to the extent any advice relating to a Federal tax issue is contained in this communication, including in any attachments, it was not written or intended to be used, and cannot be used, for the purpose of (a) avoiding any tax related penalties that may be imposed on you or any other person under the Internal Revenue Code, or (b) promoting, marketing or recommending to another person any transaction or matter addressed in this communication.

Fast Forward Academy is a leading publisher of education for enrolled agent tax preparer and tax professionals. Access to free questions for the enrolled agent is available on their website.

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