If I received payment from my renters insurance due to a fire in my apartment building that happened in February, how will that affect my tax return?

Forum|Forum|7 years ago
June 1, 2019
1 reply
1 view

A fire that happened in February destroyed my apartment and all of my possessions. Thankfully renters insurance covered nearly everything that I lost. However I'm just curious if the payments I received from my renters insurance will affect my tax refund and how?

TurboTax Free Edition iOS

Opus 17

Level 15

Your settlement is only taxable if it was more than your original cost for the destroyed items. As long as that is not the case, you don't even have to report it. If you had replacement cost coverage that did pay you more than the original purchase price of your items, the difference is taxable. You may need to do some work to figure that out and document it.

Amjain241114

Level 2

Please help on this issue . My claim value was around 13000 but since my limit was 8000 so renters insurance just paid me 8000.

xmasbaby0

Level 15

@Amjain241114

Unfortunately, the tax laws that went into effect for 2018 and beyond say that you cannot deduct a casualty loss on your federal return, even though your insurance did not cover your entire loss. Sorry.

https://ttlc.intuit.com/questions/4482873-which-federal-tax-deductions-have-been-suspended-by-tax-reform

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**