The Internal Revenue Code (IRC) allows taxpayers to deduct Casualty and theft losses (net of any insurance reimbursement) to their home, household items and vehicles. To qualify as Casualty loss, the damage must be caused by a sudden, unexpected, and unusual event. Theft is defined as the taking and removing of property or money with the intent to deprive the owner of it. Lost or mislaid property is not considered a theft, to use it in your tax return, please click here.
The amount of casualty or theft loss that a taxpayer
can deduct is the lesser of the adjusted basis of the damaged property,
or the decrease in fair market value caused by casualty or theft,
reduced by any insurance or other reimbursement you receive or expect to
receive. Where do I report Casualty & Theft Losses Tax Deduction? This deduction can be claimed on
Form 4684 (PDF),
and Form
1040, Schedule A Line 20. |
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