Personal residence and contents fire

[JenMO]

Client lost whole house and contents in house fire. They had insurance and it paid a total loss, $154,000. They rebuilt in the same place and close to the same size house, but it cost $188,000. This includes contents, too. Is this a casualty loss? deductible on Sch A? Not sure how to handle.

[spanel]

Client lost whole house and contents in house fire. They had insurance and it paid a total loss, $154,000. They rebuilt in the same place and close to the same size house, but it cost $188,000. This includes contents, too. Is this a casualty loss? deductible on Sch A? Not sure how to handle.

Your going to have to find out her cost and the FMV at the date of the fire to see if they have a loss. Cost to rebuild is not factored into the loss.

Chris

[TAXNJ]

Client lost whole house and contents in house fire. They had insurance and it paid a total loss, $154,000. They rebuilt in the same place and close to the same size house, but it cost $188,000. This includes contents, too. Is this a casualty loss? deductible on Sch A? Not sure how to handle.

See TTB starting on page 4-20 (which includes summary chart) as it may apply to your scenario.