Can I claim the deductible and diminished value of a car that was in an accident as a Casualty?
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New Member

Can I claim the deductible and diminished value of a car that was in an accident as a Casualty?

 
4 Replies
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New Member

Can I claim the deductible and diminished value of a car that was in an accident as a Casualty?

You cannot claim personal expenses, including damage from car accident in your taxes.

If the car was used exclusively for business, you may be able to claim under business expenses.

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New Member

Can I claim the deductible and diminished value of a car that was in an accident as a Casualty?

Based on the information in IRS Pub 557, your answer is not correct.  Here are some various sections of this publication related to auto accidents: 

> "Casualty losses can result from a number of different causes, including the following: car accidents"

> "NONDEDUCTIBLE LOSSES: A casualty loss isn't deductible, even to the extent the loss doesn't exceed your personal casualty gains, if the damage or destruction is caused by the following: A car accident if your willful negligence or willful act caused it."

> "The decrease in FMV used to figure the amount of a casualty or theft loss is the difference between the property's FMV immediately before and immediately after the casualty or theft."

> "CAR VALUE: Books issued by various automobile organizations that list the manufacturer and the model of your car may be useful in figuring the value of your car."

> See also: Example at the top of Page 9, related to excess damage over car insurance policy reimbursement.

 

As I read this publication, losses from auto accidents ARE deductible as casualty losses provided the loss wasn't caused by the driver claiming the loss, but are limited to the $100 and 10% rule.  Your comments?

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Level 15

Can I claim the deductible and diminished value of a car that was in an accident as a Casualty?

Was this your personal vehicle or a car used for business?  You cannot claim a casualty loss for your car if it was your personal car.  The tax laws that changed for 2018 and beyond eliminated casualty losses unless you are in a federal disaster area.

 

https://ttlc.intuit.com/questions/4482873-which-federal-tax-deductions-have-been-suspended-by-tax-re...

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
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Level 15

Can I claim the deductible and diminished value of a car that was in an accident as a Casualty?

You mean pub 547.   Personal casualty losses that are not caused by a federally declare disaster care not deductible for 2018-2025 per the TCJA (Tax Cuts and Jobs Act).

 

See Pub 547 page 2

 

Limitation on personal casualty and theft losses. Personal casualty and theft losses of an individual, sustained in a tax year beginning after 2017, are deductible only to the extent that the losses are attributable to a federally declared disaster. Personal casualty and theft losses attributable to a federally declared disaster are subject to the $100 per casualty and 10% of your adjusted gross income (AGI) limitations.
An exception to the rule above, limiting the personal casualty and theft loss deduction to losses attributable to a federally declared disaster, applies if you have personal casualty gains for the tax year.

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
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