Generally, you may claim an itemized deduction for any casualty and theft losses you suffered, but you must first determine the amount of the loss, and then figure the amount of the deduction.
Determining the amount of the loss
To determine the amount of loss you need to do two calculations:
• You first must calculate the adjusted basis of your property. The adjusted basis is usually the original cost of the property plus the cost of improvements, minus depreciation, and any previous casualty losses claimed.
• You must then calculate the decrease in fair market value of the property caused by the Read more