Casualty and Theft Losses — Tax Deduction Guide 2026
Casualty and theft losses from federally declared disasters are deductible after reducing by $100 per event and 10% of AGI. Business casualty losses remain fully deductible regardless of disaster declaration.
Eligibility
Available to individuals who suffer losses from federally declared disasters. Since 2018, personal casualty losses are only deductible if attributable to a federally declared disaster.
Tax Savings Calculator
Estimated Tax Savings
$1,100
At the 22% tax bracket, a $5,000 deduction saves you $1,100 in taxes.
Savings by Tax Bracket
Requirements
- 1Loss must result from a federally declared disaster
- 2Must reduce loss by insurance reimbursements
- 3Each casualty loss must exceed $100
- 4Total losses must exceed 10% of AGI
Common Mistakes to Avoid
- !Claiming losses not from federally declared disasters
- !Not filing insurance claims before taking deduction
- !Incorrect valuation of damaged property
- !Missing the deadline to amend returns for disaster losses
Required Tax Forms
Calculate Your Full Tax Savings
Use our free tax calculators to optimize your entire tax return.
Frequently Asked Questions
What is the Casualty and Theft Losses?
Casualty and theft losses from federally declared disasters are deductible after reducing by $100 per event and 10% of AGI. Business casualty losses remain fully deductible regardless of disaster declaration.
Who is eligible for the Casualty and Theft Losses?
Available to individuals who suffer losses from federally declared disasters. Since 2018, personal casualty losses are only deductible if attributable to a federally declared disaster.
How much can I save with the Casualty and Theft Losses?
The average tax savings is $3,000 per year. Your actual savings depend on your tax bracket and qualifying amount.
What forms do I need for the Casualty and Theft Losses?
You'll need to file Form 4684 and Schedule A to claim this deduction.
What are common mistakes with the Casualty and Theft Losses?
Common mistakes include: Claiming losses not from federally declared disasters; Not filing insurance claims before taking deduction; Incorrect valuation of damaged property; Missing the deadline to amend returns for disaster losses. Always double-check requirements before filing.
Is the Casualty and Theft Losses worth claiming?
With average savings of $3,000, the casualty and theft losses is worthwhile for most eligible taxpayers. Make sure you meet all eligibility requirements.