Increase in personal casualty and theft loss limit.(p1)
Generally, each personal casualty or theft loss is limited to the excess of the loss over $500. In addition, the 10%-of-adjusted gross income (AGI) limit continues to apply to the net loss.taxmap/pubs/p547-000.htm#en_us_publink1000225186
New Schedule L (Form 1040A or 1040).(p1)
If you claim a net disaster loss as part of your standard deduction, you must complete Schedule L (Form 1040A or 1040) and attach it to Form 1040. See Disaster Area Losses
Decrease in personal casualty and theft loss limit.(p1)
Each personal casualty or theft loss is limited to the excess of the loss over $100 (instead of $500). In addition, the 10%-of-AGI limit continues to apply to the net loss. taxmap/pubs/p547-000.htm#en_us_publink1000225189
The special rules that were in effect in 2008 and 2009 for losses of personal use property attributable to federally declared disasters do not apply to losses occurring in 2010 and later years. Instead, these losses will be subject to the 10%-of-AGI limit and will be deductible only if you itemize your deductions. These losses will continue to be subject to the $100-per-loss limit.taxmap/pubs/p547-000.htm#en_us_publink1000225191
Photographs of missing children.(p1)
The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.
This publication explains the tax treatment of casualties, thefts, and losses on deposits. A casualty occurs when your property is damaged as a result of a disaster such as a storm, fire, car accident, or similar event. A theft occurs when someone steals your property. A loss on deposits occurs when your financial institution becomes insolvent or bankrupt.
This publication discusses the following topics.
- Definitions of a casualty, theft, and loss on deposits.
- How to figure the amount of your gain or loss.
- How to treat insurance and other reimbursements you receive.
- The deduction limits.
- When and how to report a casualty or theft.
- The special rules for disaster area losses.
Generally, when you have a casualty or theft, you have to file Form 4684. You may also have to file one or more of the following forms.
- Schedule A (Form 1040).
- Form 1040NR, Schedule A (for nonresident aliens).
- Schedule D (Form 1040).
- Schedule L (Form 1040A or 1040).
- Form 4797.
For details on which form to use, see How To Report Gains and Losses,
For information on condemnations of property, see Involuntary Conversions in chapter 1 of Publication 544. taxmap/pubs/p547-000.htm#en_us_publink1000225195
Publication 584 is available to help you make a list of your stolen or damaged personal-use property and figure your loss. It includes schedules to help you figure the loss on your home and its contents, and your motor vehicles.
Publication 584-B is available to help you make a list of your stolen or damaged business or income-producing property and figure your loss.taxmap/pubs/p547-000.htm#en_us_publink1000225196
We welcome your comments about this publication and your suggestions for future editions.
You can write to us at the following address:
Internal Revenue Service
Individual Forms and Publications Branch
1111 Constitution Ave. NW, IR-6526
Washington, DC 20224
We respond to many letters by telephone. Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence.
You can email us at *firstname.lastname@example.org
. (The asterisk must be included in the address.) Please put "Publications Comment" on the subject line. Although we cannot respond individually to each email, we do appreciate your feedback and will consider your comments as we revise our tax products.
to download forms and publications, call 1-800-829-3676, or write to the address below and receive a response within 10 days after your request is received.
Internal Revenue Service
1201 N. Mitsubishi Motorway
Bloomington, IL 61705-6613
If you have a tax question, check the information available on www.irs.gov
or call 1-800-829-1040. We cannot answer tax questions sent to either of the above addresses.
You may want to see:
Publication 523 Selling Your Home 525 Taxable and Nontaxable Income 550 Investment Income and Expenses 551 Basis of Assets 584 Casualty, Disaster, and Theft Loss Workbook (Personal-Use Property) 584-B Business Casualty, Disaster, and
Theft Loss Workbook
Form (and Instructions) Schedule A (Form 1040): Itemized Deductions Form 1040NR, Schedule A: Itemized Deductions (for nonresident aliens) Schedule D (Form 1040): Capital Gains and Losses Schedule L (Form 1040A or 1040): Standard Deduction for Certain Filers 4684: Casualties and Thefts 4797: Sales of Business Property taxmap/pubs/p547-000.htm#en_us_publink1000225200
See How To Get Tax Help
near the end of this publication for information about getting publications and forms.
A casualty is the damage, destruction, or loss of property resulting from an identifiable event that is sudden, unexpected, or unusual.
- A sudden event is one that is swift, not gradual or progressive.
- An unexpected event is one that is ordinarily unanticipated and unintended.
- An unusual event is one that is not a day-to-day occurrence and that is not typical of the activity in which you were engaged.
Deductible casualty losses can result from a number of different causes, including the following.
- Car accidents (but see Nondeductible losses, next, for exceptions).
- Fires (but see Nondeductible losses, next, for exceptions).
- Government-ordered demolition or relocation of a home that is unsafe to use because of a disaster as discussed under Disaster Area Losses, later.
- Mine cave-ins.
- Sonic booms.
- Storms, including hurricanes and tornadoes.
- Terrorist attacks.
- Volcanic eruptions.
A casualty loss is not deductible if the damage or destruction is caused by the following.
- Accidentally breaking articles such as glassware or china under normal conditions.
- A family pet (explained below).
- A fire if you willfully set it, or pay someone else to set it.
- A car accident if your willful negligence or willful act caused it. The same is true if the willful act or willful negligence of someone acting for you caused the accident.
- Progressive deterioration (explained below).
Loss of property due to damage by a family pet is not deductible as a casualty loss unless the requirements discussed earlier under Casualty are met.taxmap/pubs/p547-000.htm#en_us_publink1000225206
Your antique oriental rug was damaged by your new puppy before it was housebroken. Because the damage was not unexpected and unusual, the loss is not deductible as a casualty loss. taxmap/pubs/p547-000.htm#en_us_publink1000225207
Loss of property due to progressive deterioration is not deductible as a casualty loss. This is because the damage results from a steadily operating cause or a normal process, rather than from a sudden event. The following are examples of damage due to progressive deterioration.
- The steady weakening of a building due to normal wind and weather conditions.
- The deterioration and damage to a water heater that bursts. However, the rust and water damage to rugs and drapes caused by the bursting of a water heater does qualify as a casualty.
- Most losses of property caused by droughts. To be deductible, a drought-related loss generally must be incurred in a trade or business or in a transaction entered into for profit.
- Termite or moth damage.
- The damage or destruction of trees, shrubs, or other plants by a fungus, disease, insects, worms, or similar pests. However, a sudden destruction due to an unexpected or unusual infestation of beetles or other insects may result in a casualty loss.