Can I report a loss due to a contractor who worked on my home and stole money from me (taking money for uncompleted work)?

[DianeW777 · Accepted solution]

No.  For tax years 2018 through 2025, if you are an individual, losses of personal-use property from fire, storm, shipwreck, or other casualty, or theft are deductible only if the loss is attributable to a federally declared disaster (federal casualty loss). You can add the cost of capital improvements to your original cost basis which could reduce gain on a future sale.

• What if I have property that was lost or damaged (a casualty loss)?

This would not qualify as a disaster but I added the link for  designated areas in 2023.

• Designated Disaster Areas 2023

@poloche

[Edited: 02/28/2024 | 4:10 PM PST]