When you lose an item due to an accident, theft, or act of nature, you may have a tax deduction for the value of the property that is not covered by your insurance. The tax deduction is called a "casualty loss" deduction. The lost item can be business property, investment property, or personal property. Deductible casualty losses can result from a variety of causes such as car accidents, earthquakes, floods, fire, hurricanes, or vandalism.
You will need to file a Form 4684 Casualties and Thefts to claim a casualty loss.
To enter your casualty loss in TurboTax online program, go to:
- Sign in to your account and select Pick up where you left off
- At the upper right corner, in the search box, type in casualty loss, then Enter
- Select Jump to casualty loss
- On-screen, Stolen or Damaged Items, answer Yes to the question to continue
Enter your casualty loss information in the program, and it will calculate the deduction you are entitled to. If the damage is entirely covered by the insurance reimbursement, there might not be any deductions allowed.
