Unfortunately, there is not a tax benefit for this loss on the NJ state return. The insurance deductible cannot be deducted in New Jersey.
New Jersey is considered a "gross income tax" state, meaning individuals are taxed on gross income with no itemized deductions allowed. For this reason, casualty losses are not deductible on state income tax returns.
Casualty Loss has changed this year on the federal return:
When you have items that are lost or damaged as a direct result of a natural disaster, and you live in a federally declared disaster area, you may be able to take a tax deduction for the value of the property that is not covered by your insurance.
If you have other questions about this, please ask in the comment box below:
