Casualty Loss ??

[susieq]

Further into the sason the scenarios get crazier !!! this has been a day -

tp has a sump pump. It failed. No damage to home but the backup sump (water operated) functions by running city water through it all of the time. TP did not know that this was how it worked until he got his $2200 water bill. Called the insurance agent and they informed him that if the sump is to be covered he would have to have a rider on his homeowners insurance.

Is a broken sump pump a casualty - sudden occurance. His normal water bill is about 450 for three months.

Is this a stretch ?? for over the average water bill plus the cost to replace - no coverage

[erchess]

Many Problems

First of all, we would have to know why it failed. If it simply wore out at the end of a reasonable useful life, that would not be a casualty. On the other hand if it went out early in its career because of an electrical surge or because of faulty wiring that could be a casualty.

Second, what was his basis and what is his income. For a personal casualty such as this one all the losses due to one event are reduced by one hundred dollars and then the aggregate of what is left from all of them is reduced by ten percent of agi. Thus most of my clients would not be able to deduct a personal casualty of a couple thousand dollars.

If the failed pump had resulted in damage to his property, that would be a casualty loss even if the sump pump simply wore out and was not part of the allowable loss.. However, I do not think that his water bill counts. I could be wrong about that however. Let us see what others think.

[Koss]

Pump Failure

Maybe he can take it as a credit for hydroelectric power or something...

LMAO