---
title: Deducting Casualty or Theft Losses
description: Deducting Casualty or Theft Losses
image: https://info.ongandcompany.com/hubfs/casualtytheft.png
---

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# Deducting Casualty or Theft Losses

[Richard Ong](https://info.ongandcompany.com/blog/author/richard-ong) / February 11, 2017 /

[Tax Deductions](https://info.ongandcompany.com/blog/topic/tax-deductions)

![](https://app.hubspot.com/settings/avatar/89ca6f67445537c2c631f1fe9d43c977)

No one enjoys picking up the pieces after a natural disaster or when some other calamity destroys personal property like a home or car. But at least you may be in line for some tax relief. If you qualify, you can deduct part of your unreimbursed losses from casualties and thefts on your 2016 tax return. However, there are a couple of obstacles to overcome.

First, you must reduce the loss eligible for the deduction by any insurance reimbursements. If your insurance coverage "makes you whole," you get no deduction. Second, you can only deduct the excess loss above 10% of your adjusted gross income (AGI) for the year, after you subtract $100 for each event. For example, if you suffer a single loss of $15,000 in a year in which your AGI is $100,000, your deduction is limited to $4,900.

Furthermore, deductions are available for most, but not all, casualties and thefts. The event must be "sudden, unexpected or unusual." Typically, you will qualify if you suffer a loss from a natural disaster like a hurricane, flood or blizzard, or you're victimized by a home burglary. Similarly, damage to your car in an accident counts. But you can't write off a loss resulting from deterioration over an extended period of time, like damage due to a drought or termites.

Deductions are normally claimed in the year in which the loss is sustained. But there's a special exception for victims in federally-declared disaster areas. For these losses, you can elect to obtain quick relief on the tax return for the year preceding the loss. In other words, if you suffer a disaster-area loss early in 2017, you can deduct the loss on your 2016 tax return.

Finally, don't leave matters to chance. Obtain a professional appraisal for personal property damage in case the IRS ever challenges your deduction.

[![Download 2016 Tax Guide (Tools, Rates, and Deadlines)](https://no-cache.hubspot.com/cta/default/2284926/1a6fec97-04af-4249-8937-9751dc5fb94b.png)](https://cta-redirect.hubspot.com/cta/redirect/2284926/1a6fec97-04af-4249-8937-9751dc5fb94b)

 

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