Casualty losses are deductible in the year you sustain the loss, which is generally in the year the casualty occurred. The form doesn't ask how much you paid to repair, it asks for the Fair Market Value before and after the event. https://www.irs.gov/pub/irs-pdf/f4684.pdf
Here is how casualty losses work:
Individuals are required to claim their casualty and theft losses as an
itemized deduction on Form 1040, Schedule A Itemized Deductions.
- For property held by you for
personal use, Subtracted any salvage value (zero for theft) and any insurance or
other reimbursement from the loss amount.
- Then, subtract
$100 from each casualty or theft event that occurred during the year.
- Then, take that
amount and subtract 10% of your adjusted gross income from that total
to calculate your allowable casualty and theft losses for the year.
- That's the amount that goes
on your Schedule A Itemized Deductions.
If
your property is personal-use property or is not completely destroyed, the
amount of your casualty loss is the lesser of:
- The adjusted basis of your
property, or
-
The decrease in fair market
value of your property as a result of the casualty
More details can be found at this link http://www.irs.gov/taxtopics/tc515.html
That
said, the amount would have to be pretty large for you to be able
benefit. Also, you must file Schedule A as I stated above. But, if
you want to give it a shot in the Casualty and Theft section of the software,
it wouldn't hurt.
How to
enter it into TurboTax: While
inside the software and working on your return, type casualty loss in the Search at the top of the screen (you
may see a magnifying glass there). There will be a popup that says Jump to casualty loss. Select that to get to the general area.
