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Casualty Loss Criteria

As a result of the Tax Cuts and Jobs Act of 2017 (2017 tax reform): you can only deduct casualty losses that took place in a federally declared disaster area. 

Go to this section in Credit Karma Tax: Casualty and/or Thefts

A federally declared disaster areas are declared by the President of the United States to be eligible for federal aid under the Robert T. Stafford Disaster Relief and Emergency Assistance Act. Some recent examples include areas that were affected by Hurricanes Maria, Irma, Harvey and Florence or areas affected by the California Wildfires. The IRS provides a list of eligible federally declared disaster areas in their page on Tax Relief in Disaster Situations.

The amount of loss must be reduced by any salvage value and/or reimbursement you receive or expect to receive from insurance, federal and/or state relief, etc.
Source: irs.gov

Note: Some states still allow you to deduct losses related to:

  • Car accidents
  • Earthquakes
  • Fires
  • Floods
  • Government ordered demolition of a home that is unsafe because of a disaster
  • Mine cave-ins
  • Shipwrecks
  • Sonic booms
  • Storms (such as hurricanes and tornadoes)
  • Terrorist attacks
  • Vandalism
  • Volcanic eruptions

If you had casualty loss in 2018 you should still enter your info on Credit Karma Tax to see if you qualify for a deduction for these items on your state return.

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