It is not compared to the amount that you have spent to repair. It is compared to the basis of the property.
Gain on Reimbursement
If the amount you receive in insurance or
other reimbursement is more than the cost or
other basis of the property, you have a gain.
If you have a gain, you may have to pay tax
on it, or you may be able to postpone the
gain.
Don't report the gain on damaged,
destroyed, or stolen property if you receive
property that is similar or related to it in
service or use.
https://www.irs.gov/pub/irs-pdf/i4684.pdf
