Many Road Home recipients may have to pay a bunch in taxes

[hambubba]

Many Road Home recipients may have to pay a bunch in taxes

While the Road Home program has paid out more than 50,000 grant to help hurricane-affected homeowners, many recipients may have to pay back as income tax as much as 35 percent of their grants

if Social Security recipients claimed sizable casualty losses and then got large Road Home grants, they may go from not having to file a federal tax return to having to pay taxes on all their income, including their grant and pension.

[Sara@home]

For example, accountant Jerry Schreiber said that if Social Security recipients claimed sizable casualty losses and then got large Road Home grants, they may go from not having to file a federal tax return to having to pay taxes on all their income, including their grant and pension.

If they didn't have to file because their income was below the exemption/standard deduction they wouldn't have claimed the loss on their taxes because they had no tax to reduce. The people who claimed the loss likely had sufficient income to offset the loss when they claimed it.

[Four Kitties]

Originally Posted by Sara@home

If they didn't have to file because their income was below the exemption/standard deduction they wouldn't have claimed the loss on their taxes. The people who claimed the loss likely had sufficient income to offset the loss when they claimed it.

I think the "casualty loss" claimed was on insurance policies, not income tax returns.

Four Kitties

[Sara@home]

Originally Posted by Four Kitties

I think the "casualty loss" claimed was on insurance policies, not income tax returns.

I don't think so. The article is discussing taxes and the comments are by an accountant. "Casualty loss" is tax talk, an IRS term, and they are taken on Sch A, Sch D or Form 4684. See Pub 547 or Pub 584.

[Four Kitties]

I'll take your word for it -- I pay a professional for that sort of thing for precisely this reason!

Four Kitties