Tax Relief for Victims of Crimes, Scams, and Disasters Act

Summary

Restores the federal personal casualty loss tax deduction that had been suspended, making it available again for tax years beginning after December 31, 2017. It also gives certain taxpayers extra time to file IRS claims for credit or refund for prior returns (for years ending before January 1, 2025) when their casualty loss deduction was suspended at filing, by extending the statute-of-limitations deadline for those specific claims.

• Reinstates the personal casualty loss deduction that had been suspended by prior law.
• Restoration applies to taxable years beginning after December 31, 2017.
• Allows affected taxpayers to file refund or credit claims for prior returns (years ending before January 1, 2025) where the deduction was suspended.
• Extends the statute-of-limitations deadline under 26 U.S.C. § 6511(a) for these specific claims until the filing deadline for the return covering the enactment date.
• Makes the usual 2‑year/3‑year limit in § 6511(b)(2) inapplicable for claims tied to restored personal casualty loss deductions.
• Relief is limited to personal casualty losses under § 165(c)(3); business casualty losses are not covered.
• No new spending programs or appropriations are created; this is a tax-code and administrative-deadline change.
• Will likely increase amended-return and refund claims, requiring IRS administrative action and verification.
• Applies retroactively to tax years beginning after 2017 but only affects claims for returns ending before 2025.