A complete guide to Missouri’s Homestead Disaster Tax Credit — and federal relief for clients in neighboring states.
If your home was damaged by a qualifying storm last year, there may be money available that most people don’t know to claim. This blog covers two layers of potential relief.
Please read both sections as a Missouri client may qualify for both.
SECTION ONE: Missouri Residents – The Missouri Homestead Disaster Tax Credit
This credit equals the insurance deductible you paid after a qualifying 2025 disaster — up to $5,000 — applied dollar-for-dollar against your Missouri state income tax bill. It’s not a deduction. It directly reduces what you owe.
To qualify, all six conditions must be met:
1. The damage was to your primary residence (not a rental, vacation home, or second home)
2. You lived there for more than six months before the disaster
3. The disaster triggered a formal presidential disaster declaration request by Missouri’s Governor — confirmed qualifying periods are March 14–15, March 30–April 8, and May 16, 2025. Check dor.mo.gov/tax-credits/hdc.html for updates.
4. You filed a claim under a homeowner’s or renter’s insurance policy and paid a deductible
5. Your insurance company is licensed in Missouri
6. The deductible was incurred during the 2025 calendar year
To claim it, file Form 5926, Form MO-TC, and a letter from your insurer with your Missouri return. Note that including Form 5926 typically requires a mailed return rather than e-filed.
SECTION TWO: Clients in Neighboring States No State Credit — But Federal Relief May Apply
Missouri’s credit is unique to Missouri. However, federal law provides a casualty loss deduction that may be significant — especially for clients in federally declared disaster areas.
Qualified Disaster treatment (the favorable tier) applies to major disasters declared between January 1, 2020 and September 2, 2025. Under this tier: there’s no 10% AGI floor, no itemizing required, and the deduction stacks on top of your standard deduction. Your unreimbursed loss — the gap between actual property damage and what insurance covered — minus a $500 floor is fully deductible.
Standard treatment applies outside that window and is far less valuable: losses must exceed 10% of your income before any deduction applies, and you must itemize.
Planning note: For any federally declared disaster, you can elect to claim the loss on your 2024 return instead of 2025, which can accelerate your refund. You can also access penalty-free retirement account withdrawals up to $22,000 with income spread over three years, and plan loan limits up to $100,000.
| State | Federal Relief Available? |
| Illinois | Likely — Qualified Disaster treatment for affected counties |
| Kansas | No confirmed 2025 declarations — standard rules apply |
| Kentucky | Yes — entire state covered for Feb. 2025 storms |
| Tennessee | Yes — entire state covered for April 2025 storms |
| Arkansas | Yes — entire state covered for April 2025 storms |
| Iowa | No confirmed 2025 declarations — standard rules apply |
Confirm your specific county and event date against official FEMA and DOR lists.
What to Do Now
- Request a letter from your insurer confirming the policy type, claim, and deductible incurred
- Confirm your storm date and county against the Missouri DOR and FEMA lists
- Preserve documentation of your full loss — estimates, bids, adjuster reports, and photos
- Consider whether pulling the deduction back to your 2024 return makes sense for your situation
One More Thing: These Windows Close
Missouri’s credit has a hard deadline — no new credits after October 15, 2026. The federal prior-year election is tied to your return’s due date. Neither can be revisited after your return is filed without them. An amended return is possible, but it means more time and a tighter window. Tax season is the moment to capture this.
We’re Here to Handle This for You
Storm damage isn’t something most people plan for — but navigating what comes after it is exactly the kind of situation where having a team already familiar with your financial picture makes a difference.
If you’re a Gatewood Tax & Accounting client, you don’t need to sort through these rules on your own. We’ll review your situation, confirm eligibility, work to gather the documentation you need, and make sure nothing is left on the table when we file your return.
If you have questions about whether you qualify — or you’re not sure where to start — schedule a conversation with us today.
Important Disclosures:
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Gatewood Wealth Solutions and LPL Financial do not provide legal or tax advice or services.
All investing involves risk including loss of principal. No strategy assures success or protects against loss.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.
