This is not a popular deduction, and few people probably realize it is even an option. But if you have a casualty loss then you can write that off, even if it is a personal asset (like a car or home). [Usually personal losses are not allowed and only business losses can be deducted, but this is the exception].
Your loss has to be the complete or partial destruction of property resulting from a sudden, unexpected and unusual identifiable event. This rules out natural wear and tear (like the need for a new roof after 20 years or an AC unit after 10). However, if the damage is the result of:
Fires, either started by, for example, an electrical short or a lightning strike;
Storms, such as tornadoes, ice, hurricanes and the like;
Floods or, in some cases, droughts; and
- Burglary or theft
Earthquakes and mudslides.
then you probably have a loss that you can claim.
You have to reduce your claim by any insurance money your receive. The claim is also limited in other ways by the IRS formulas, basically making it worth your time and effort to only claim large casualties.
More info
here and
here.
Disclaimer
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