Disaster Loss


DEFINITION of 'Disaster Loss'

A special type of tax-deductible loss, similar to a casualty loss, where a loss has been incurred by taxpayers who reside in an area that has been designated as a federal disaster area by the President. Disaster losses can arise from such phenomena as floods, forest fires and earthquakes.

BREAKING DOWN 'Disaster Loss'

Disaster losses may be deducted either in the year that the loss is incurred or the previous year, if it is more beneficial to the taxpayer and pending on the type of disaster. Homeowners who must relocate due to damage in a disaster area can often claim a loss even though the damage sustained does not meet the sudden event test.

  1. Property Insurance

    A policy that provides financial reimbursement to the owner or ...
  2. Business Continuity Planning - ...

    The creation of a strategy through the recognition of threats ...
  3. Disaster Relief Act

    A United States federal law passed in 1974 that laid down the ...
  4. Consequential Loss

    The amount of loss incurred as a result of being unable to use ...
  5. Catastrophe Insurance

    Insurance to protect businesses and residences against natural ...
  6. Loss Settlement Amount

    A term used to denote the amount of a homeowner's insurance settlement. ...
Related Articles
  1. Credit & Loans

    Student Loan Deferment: Live to Pay Another Day

    Extending your principal repayment date can increase your chances of fighting off default.
  2. Home & Auto

    Protecting Your Financial Documents From Disaster

    Organizing and updating your records regularly can save you a lot of grief in a time of crisis.
  3. Home & Auto

    Prepare Your Finances To Handle Natural Disasters

    Use these easy tips to protect your financial interests from natural disasters.
  4. Options & Futures

    Insurance 101 For Renters

    If it's time for you to leave the nest, find out how to protect your new home from disaster.
  5. Investing Basics

    How Profits Will Be Made As The Globe Heats Up

    Climate change will harm earth and its inhabitants in various ways, but certain industries will see increased profits as a result.
  6. Home & Auto

    4 Areas to Consider Roofing Material Types

    Roofing your home is very important, that’s why you should choose a roof specifically designed to handle your area’s climate.
  7. Taxes

    Deducting Disaster: Casualty And Theft Losses

    If you've been a victim, your losses may be deductible. Find out how.
  8. Home & Auto

    5 Investment Risks Created By Global Warming

    Climate-change deniers and believers alike would be wise to prepare for the worst.
  9. Personal Finance

    Eight Financial Safeguards If Disaster Strikes

    In an emergency like a fire, hurricane, flood, tornado or earthquake, you may not be able to protect your home. But you can take steps to avoid financial disaster.
  10. Taxes

    Cut Taxes By Reporting Property Damage

    Know the options you have for your insured property if and when a disaster strikes.
  1. Suppose my garage collapsed onto my car. Are damages covered by my home insurance ...

    Generally, damage to an automobile will be covered by comprehensive car insurance, which is in addition to collision coverage ... Read Full Answer >>
  2. What is a "force majeure"?

    A force majeure is derived from the French term meaning "greater force" and refers to any natural and unavoidable catastrophe. ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Take A Bath

    A slang term referring to the situation of an investor who has experienced a large loss from an investment or speculative ...
  2. Black Friday

    1. A day of stock market catastrophe. Originally, September 24, 1869, was deemed Black Friday. The crash was sparked by gold ...
  3. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  4. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  5. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  6. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
Trading Center