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Question for the Money Doctors

Question submitted on Jan 13, 2011.

Question

we had a loss of a personal storage building that collapsed under snow load and not covered by insurance the cost to rebuild was ~$50,000 is any of this deductable? Thanks for your response

Answer

This should be deductible as a casualty loss on Schedule A.  The amount of loss is the lesser of your cost of the property lost or its fair market value prior to the loss. reduced by $100, and then further reduced by 10% of your adjusted gross income.  You report the loss on Form 4684,  You can get more information by reading Publication 584 from the Internal Revenue Service.


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