Our garage caught fire this last July. Can we claim a loss on our income tax return?
If you lose property through casualty or theft, you may be entitled to a tax deduction for the amount not compensated for by insurance or otherwise. A casualty is the damage, destruction, or loss of property resulting from an identifiable event that is sudden, unexpected, or unusual in nature. Some examples of casualties include car accidents, fires, and vandalism. If your property is covered by insurance, you cannot deduct a loss unless you file a timely insurance claim for reimbursement. To claim a casualty or theft loss, you must complete Form 4684 (PDF), Casualties and Thefts, and attach it to your return. Claim the amount from the form on line 19 of Form 1040, Schedule A (PDF), Itemized Deductions. If your loss took place in a declared disaster area, please refer to Tax Topic 515, Disaster Area Losses (Including Flood Losses). For more information, refer to Form 4684 (PDF), Casualties and Thefts, or Tax Topic 507, Casualty Losses, or Publication 547, Casualties, Disasters, and Thefts . If many items are involved, also refer to Publication 584, Casualty, Disaster, and Theft Loss Workbook.
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