No. You have replacement cost coverage on your policy, which means the company will pay for all the repairs except the deductible. However, it comes with a catch. In order to collect the full amount you have to actually replace all the damaged stuff to the full replacement cost. The company will hold back depreciation for the damaged items based on age and condition. This amount is deducted from the first payment. After the repairs are complete or nearly complete contact the company and they will want documentation that the repairs are done. Then they should send you the withheld amount. Contact your insurance agent and they can explain it to you.
However, you may be able to claim a casualty loss for the amounts of damage not covered by insurance.
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 to 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.
