Diminished Value is
TAX DEDUCTIBLE
Branson West, MO - Jan 01, 2006 - The Insurance Consumer Advocate Network (iCan) estimates 16,000,000 (16 Million) consumers overlook $56,000,000,000 ($56 Billion) worth of "Casualty Loss" tax deductions (Form 1040, Schedule "A", Line # 19) every year. Review this article with your tax advisor to see if you could qualify for a $3,500.00 (average) tax deduction.
It is estimated that 20,000,000 vehicles suffered some form of damage in 2005. Less than 20% of those damaged vehicles were processed as a "Total Loss" by their insurers. That means more than 16,000,000 vehicles were either considered to be reparable by their insurers or were uninsured for physical damage.
When a vehicle with no prior damage history is repaired, it now has a traceable documented damage history. Such damage history records are maintained by ... insurance companies (either separately or through industry service providers such as CCC or ADP) ... State DMV records (when title "Branding" laws are enforced) ... and Vehicle History Report services such as CarFax.
The Resale Value of a vehicle with a Damage History is substantially less than a comparable vehicle with No Damage History. That post-repair reduction in resale value is generically referred to as "Diminished Value." To be more accurate, the Insurance Consumer Advocate Network (iCan) uses the phrase "Residual Inherent Diminished Value" which they define as "That portion of a vehicle's pre-loss value that has not been restored via the repair process."
According to Diminished Value Consumer Survey statistics, compiled by the Insurance Consumer Advocate Network (iCan), vehicles that suffer damage at the rate of 25% of that vehicle's pre-loss Fair Market Value (and are repaired with factory OEM parts) will also suffer an additional 19.74% - 20.44% loss of resale value. Vehicles repaired with After-Market (non-factory) Body Parts will suffer a Post-Repair Residual Inherent Diminished Value at the rate of 36.85% - 37.63% of its pre-loss Fair Market Value (statistical data as of 12/31/2005).
EXAMPLE:
If you own a $20,000.00 vehicle with no damage history, that sustains $5,000.00 worth of damage, and assuming the repairs were performed properly using factory body parts, statistics show you would suffer a loss of resale value of approximately $4,000.00. If After-Market body parts are installed on your vehicle, the loss of resale value would be more in the range of $7,000.00.
The Residual Inherent Diminished Value applicable to a specific vehicle would require the assistance of a qualified professional appraiser. The net savings on your tax liability should be defined by a qualified tax consultant.
WARNING:
Do Not try to Hide your vehicle's Damage History! Most states have adopted a version of the Uniform Commercial Code (UCC) which defines "Failure to disclose" a material fact (damage history), about the vehicle you are offering for sale, constitutes "Consumer Fraud" ... a Felony ! In order to protect their down-line liability, many dealerships now require vehicle owners to sign a "Trade-in Affidavit" requiring disclosure of any damage history.
More information on Diminished Value can be accessed onLine by going to the Insurance Consumer Advocate Network web site at www.iCan2000.com/dvfaqs.html. A State-by-State listing of Diminished Value Appraisers can be accessed at www.ican2000.com/help/dvpros.
______________________________________________________________
The Insurance Consumer Advocate Network is an InterNet based consumer advocacy effort designed to ... Increase Consumer Awareness as to Insurance Related Issues ... Encourage Consumer Involvement with Insurance Related Efforts ... and, Facilitate Consumer Contact with Pro-Consumer Entities.
The InterNet web site for the Insurance Consumer Advocate Network is www.iCan2000.com
|
