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hhqe3
New Member

Can I deduct the cost of getting the my basement dried out professionally, and the cost of the three new sump pumps AND the cost to repair the plumbing to a sump pump?

Excessive water from storms caused pvc plumbing to a sump pump to break, and I had to replace two sump pumps because they had to run so much.  I also paid $1300 out of pocket for having the basement dried out.  Can I deduct the water clean-up charges, the plumbing charges and the cost of two sump pumps and labor from my taxes?

5 Replies
SweetieJean
Level 15

Can I deduct the cost of getting the my basement dried out professionally, and the cost of the three new sump pumps AND the cost to repair the plumbing to a sump pump?

Any insurance?
hhqe3
New Member

Can I deduct the cost of getting the my basement dried out professionally, and the cost of the three new sump pumps AND the cost to repair the plumbing to a sump pump?

No. My deductible is $1,000 so I just paid the whole thing so I wouldn't have a claim on my record.
SweetieJean
Level 15

Can I deduct the cost of getting the my basement dried out professionally, and the cost of the three new sump pumps AND the cost to repair the plumbing to a sump pump?

Per the IRS, "If your property is covered by insurance, you must file a timely insurance claim for reimbursement of your loss. Otherwise, you can't deduct this loss as a casualty or theft."
Was this from a Hurricane, or otherwise in a Federal Disaster area?
SweetieJean
Level 15

Can I deduct the cost of getting the my basement dried out professionally, and the cost of the three new sump pumps AND the cost to repair the plumbing to a sump pump?

Your own labor is not deductible.

It is difficult to claim a casualty loss because you have to meet a tough threshold. Only the amount of a casualty loss that is OVER 10% of your adjusted gross income can be counted toward your itemized deductions, and even then you must subtract $100 from that amount. 

If you want to enter your casualty loss, go to the Federal>Deductions and Credits> Deductions and Credits>Casualties and Thefts.

Opus 17
Level 15

Can I deduct the cost of getting the my basement dried out professionally, and the cost of the three new sump pumps AND the cost to repair the plumbing to a sump pump?

The concept is that your casualty loss is the decrease in property value caused by the damage.  The IRS allows you to use the repair cost as a reasonable estimate the decrease in value assuming the repair doesn't substantially increase the value of the property.  (For example, if you tore out 10 year old carpeting and replaced it with brand new, part of the cost is a betterment and not part of your loss.)

Then, the IRS requires you to submit a claim if you can.

For the remaining loss ($1000, or the $1000 deductible plus any uncovered expenses) the casualty deduction rules call for a deductible equal to 10% of your income.  So if your income is $50,000, there is a $5,000 deductible on the loss.  The rest of the loss (if any) would be deductible as an itemized deduction on schedule A.

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
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