Declaring a casualty loss (fire) on primary home.

lmstepancic
lmstepancic Member Posts: 2 Newcomer
edited January 15 in Situation & Life Changes

My home was seriously damaged by fire in 2022 - rendering it uninhabitable - maybe forever. Since casualty losses on residences aren't allowed anymore, what alternatives do I have tax-wise?

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  • ConroyK
    ConroyK FreeTaxUSA Agent Posts: 1
    Answer ✓

    Nonbusiness property (like a primary home) casualty and theft losses not from a federal disaster can only be used to offset casualty and theft gains. For example if you received a gain from insurance, government, or other parties to compensate for the damage, then declaring a casualty loss could decrease the amount of taxable gain you received.

    However, if you did not receive a casualty and theft gain, there are unfortunately no other alternatives to this situation.

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  • lmstepancic
    lmstepancic Member Posts: 2 Newcomer
    Answer ✓

    Thank you for confirming.

    "Fortunately" there was a federally declared disaster (flood) in the area in 2023 - subsequent to the fire - which made the exposed property irreparable. How do I go about taking that loss on my 2023 return?

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