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Itemized Deductions Schedule-A


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Old 03-01-2011, 02:28 PM
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Should I take the casualty loss deduction?

I typically do my own taxes using the 1040 EZ form. Last year my apartment was destroyed by a fire. I had insurance, and they estimated my losses at $30K. They paid me approx. $22K.

Is it worth the time and expense (since I'd have to pay someone to do it) to submit the casualty loss form with my return and take any deduction coming to me? I just don't want to go through the expense if it nets me $10!

Thank you,

David



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Old 03-02-2011, 06:44 AM
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“Is it worth the time and expense (since I'd have to pay someone to do it) to submit the casualty loss form with my return and take any deduction coming to me?”--->As you can see, you can take an itemized deduction on your income taxes for losses due to casualty or theft by itemizing deductions; if you do not itemize your deductions, then you can’t deduct your casualty and theft losses on your return.However, it depends on. Every taxpayer is entitled to a standard deduction. This is a flat dollar amount that reduces your taxable income, thereby resulting in a lower tax figure when your taxes are calculated. The tax laws allow you to claim the higher of your or what's called the itemized deductions. These itemized deductions include a long list of tax breaks. In general, you will come out ahead if you claim whichever deduction amount is higher, as this will provide the greatest tax savings to you. So, itemizing deductions o n 1040 Sch A depends largely on what kind of tax-deductible expenses you incurred last year. Generally speaking, you that are with these common deductions should tally up your deductions and see if it's more than your standard deduction: State & local taxes, Real estate taxes, Mortgage interest, Charitable donations, and casualty and theft losses. For thefts or casualties of personal or family property, your deductible loss is much more strictly limited. You can actually deduct losses exceding 10% of AGI for your theft and casualty losses; $30,000( basis)-$22,000( insurance proceeds)-$100=$7,900, and After the first $100 is subtracted, you're not in the clear yet. You must again reduce your deductible loss by a full 10 percent of your adjusted gross income.You can deduct $900 if your agi is $70,000; $70,00*0.1=$7,000, $7,900-$7,000=$900.



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