Can I Claim a Property Casualty Loss?

Brenda in Connecticut was in a car accident in 2008 on Thanksgiving Day, and it wasn’t her fault. Her insurance company has gone after the other driver. Can they now claim that $1,000 on their taxes as a property casualty loss?

QUESTION: Brenda in Connecticut was in a car accident in 2008 on Thanksgiving Day, and it wasn’t her fault. She and the other driver exchanged insurance, and she ended up paying the deductible. Her insurance company has gone after the other driver. Can they now claim that $1,000 on their taxes as a property casualty loss?

ANSWER: It is deductible, but there are restrictions. First of all, it has to exceed 10% of your AGI, and then there’s another $100 floor, and then it’s an itemized deduction with Form 4884. If you made more than $10,000, no, you can’t deduct it. There is a tremendous amount of restrictions on casualty losses and any kind of loss like that.

Jump-Start Your Goals!

Jump-Start Your Goals!

Get our 8-Day JUMP START series and weekly newsletter that are packed with articles and tools to help you win with money.

Find a Local Expert

Start with a Local Expert

Get trustworthy guidance to help you save money on life’s most complicated financial decisions.

Find an ELP

Thank You!

Your 8-Day Jump Start is on its way to !