Considered a casualty loss

We had water damage to our basement (water heater, washer/dryer, etc) which was caused by the company across the street digging and rupturing a county drainage pipe from our side of the street.

Insurance only paid about 1/3. Is this considered a casualty loss

MinhT1
Expert Alumni

Business & farm

This would have been a Theft and casualty loss before tax year 2018, but not in 2019.

 

The tax treatment of personal casualty losses and thefts is changed under the Tax Cuts and Jobs Act. Pursuant to the TCJA, the itemized deduction for personal casualty and theft losses is temporarily limited in tax years 2018 through 2025 solely to losses attributable to federally-declared disasters.

 

 

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wgant12
New Member

Business & farm

Water damage in our bedroom from storm.  Insurance company refused coverage.  Said was preexisting condition.  We had repaired at our expense.

Business & farm


@wgant12 wrote:

Water damage in our bedroom from storm.  Insurance company refused coverage.  Said was preexisting condition.  We had repaired at our expense.


Repair expenses on a personal residence are not deductible on a tax return.

 

Casualty and theft loses are not deductible on a federal tax return if they are not caused by a federally declared natural disaster.