Casualty losses are generally deductible in the year the casualty occurs. However, if you suffer a deductible casualty loss in an area that is declared a federal disaster by the President, you may elect to deduct the loss for your taxes for the previous year. This will provide you with a quick tax refund since you'll get back part of the tax you paid for the prior year. If you have already filed your return for the prior year, you can claim a disaster loss against that year's income by filing an amended return. You must do so within six months after the regular due date for filing your original return for the disaster year.
You can determine if an area has been declared a disaster area by checking the Federal Emergency Management Administration (FEMA) website.
