If your insurance reimbursement for the lost or damaged property is greater than the cost, you may generate a capital gain as your income. You are advised to file a Form 4684 Casualties and Thefts to claim a casualty loss and if there is a gain being generated, the program will create a Schedule D with the capital gain and finalize your Form 1040 to file.
To enter your casualty loss and possible capital gain 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
