Tornado Damage And Taxes

[Grape Ape Mom]

My house was in the path of a tornado in December 2015, and had some damage. Insurance paid for almost everything that was repaired, so I didn't plan to claim very many expenses for the repairs.

My first question is about the depreciation for the roof, gutters, windows, screens, fence, and carpet replaced in two bedrooms. Can I use the insurance valuation and date of actual repair/replacement to claim T/S% depreciation on these new items?

In the middle of our disaster, we also had to have our foundation repaired for about $8000. Is this deducted as a repair with T/S%?

Thank you!

April

[TomCopeland]

casualty loss

My house was in the path of a tornado in December 2015, and had some damage. Insurance paid for almost everything that was repaired, so I didn't plan to claim very many expenses for the repairs.

My first question is about the depreciation for the roof, gutters, windows, screens, fence, and carpet replaced in two bedrooms. Can I use the insurance valuation and date of actual repair/replacement to claim T/S% depreciation on these new items?

In the middle of our disaster, we also had to have our foundation repaired for about $8000. Is this deducted as a repair with T/S%?

Thank you!

April

You can't deduct any expense that was covered by insurance. You can deduct or depreciate your out of pocket expenses such as deductibles, etc.

If you had been depreciating some of the items that were replaced (roof, windows, fence, etc.) and had not fully depreciated them, you can deduct all remaining depreciation now.

Whether or not the foundation work is a repair or a home improvement depends on whether it's considered a "betterment" to your property. If it simply bringing the foundation back to its former use, then it's a repair and you can deduct the time-space% in one year. If it's increasing the size of the foundation then treat it as a home improvement and depreciate it over 39 years.