Question

the text explains what are casualty and theft losses that an individual may deduct, even though the losses are related to personal use property. The text gives examples of occurrences that cause losses that do not qualify as casualty losses, and states that misplacing items does not count as a “theft.” However, the IRS gives more detailed guidance on these issues.

What occurrences do not result in deductible casualty losses according to the IRS in addition to those listed in the text?

What occurrences do not result in deductible theft losses according to the IRS in addition to those listed in the text?

At the same time it is explaining the occurrences that do not result in deductible casualty or theft losses, the IRS states that deductible losses can result from two specific occurrences that would seem to fall into the “nondeductible” category. Briefly describe these provisions. Please answer each question in complete sentences, and cite the name and number of the IRS publication or form/instruction where you found each answer, and the page number on which the answer is found. Use your own words in the answer – do not copy the IRS’ language.

Answer 1

solution :

What’s a casualty?

A casualty is damage, destruction, or property loss resulting from one of these identifiable events:

Sudden occasion — quick, as opposed to continuous or dynamic

Sudden occasion — customarily unforeseen and unintended

Strange occasion — not an everyday event

Nondeductible misfortunes

You can't deduct a setback misfortune if the harm or demolition is caused by any of these:

Inadvertently breaking things, similar to dishes or china, under typical conditions

Harm a family pet does, except if the setback necessities are met. Ex: Your new little dog, who's not housebroken, harmed your antique Oriental floor covering. Since the harm isn't unforeseen or irregular, you can't deduct the misfortune.

Fire you stubbornly set or you paid another person to set

Auto collision if your persistent carelessness or resolute act caused it. The equivalent is valid in the event that somebody representing you caused the mishap.

Dynamic disintegration if the harm results from a relentlessly working reason or a typical procedure, as:

Unfaltering debilitating of a working because of ordinary breeze and climate conditions

Decay and harm to a water warmer that blasts. In any case, the harm to carpets and window hangings caused by the blasting of a water warmer qualifies as a loss.

Most misfortunes of property caused by dry seasons. To deduct it, you more likely than not brought about a dry spell related misfortune in one of these:

Exchange or business, such as cultivating

Exchange went into for benefit

Termite or moth harm

Harm or pulverization of trees, bushes, or different plants by:

Parasite

Illness

Creepy crawlies, worms, or comparable irritations. Be that as it may, a sudden decimation due to a startling or surprising creepy crawly pervasion may result in a setback misfortune.

Inability to record a protection guarantee for repayment

On the off chance that your property is secured by protection, you should document an auspicious protection guarantee for your misfortune. Else, you can't deduct the misfortune as a loss or robbery. Be that as it may, the segment of the misfortune not secured by protection, similar to a deductible, isn't liable to this standard. To take in more, see Publication 547: Casualties, Disasters, and Thefts at www.irs.gov.

What’s a theft?

A theft is the taking and removing of money or property with the intent to deprive the owner of it. The taking of property must be:
Unlawful under the law of the state where it happened

Finished with criminal aim

Theft includes the taking of money or property by:

Blackmail
Burglary
Embezzlement
Extortion
Kidnapping for ransom
Larceny
Robbery
Fraud or misrepresentation

Citizen Theft Loss Deduction

(IRC §165(c)(2)(3))

Under IRC §165, an individual may deduct misfortunes emerging from "flame, tempest, wreck, or other setback or from robbery."

Under IRC §165(c)(2), an individual may deduct robbery misfortunes including an exchange went into for benefit.

Under IRC §165(c)(3), an individual may deduct misfortunes because of robbery (see Treas. Reg. Segment 1.165-8(d)).

A misfortune emerging from robbery is treated as continued amid the assessable year in which the Taxpayer finds the misfortune (IRC §165(e)(1)).

The deductible sum is the lesser of the honest esteem or premise of the property stolen (Treas. Reg. §1.165-8(c)), IRC §165(b).

An individual is allowed to deduct misfortunes to her property emerging from "flame, tempest, wreck, or other loss, or from burglary." The expression "other loss" characterized as a sudden, unforeseen occasion that is abnormal in nature and outside the ability to control of the citizen.

A burglary misfortune actually isn't a loss misfortune, yet robbery misfortunes are collected with loss misfortunes for generally purposes. The main $500 (2009) of every close to home loss or robbery misfortune isn't deductible, and individual setback and burglary misfortunes are for the most part deductible just to the degree they surpass 10 percent of the citizen's AGI.

Setback and robbery misfortunes that emerge in an exchange or business or movement occupied with for benefit are deductible (as are different misfortunes emerging in these exercises) and may meet all requirements for useful treatment under Code Section 1231.

The segment of a misfortune that is repaid by protection isn't deductible (Code Section 165(a)). An individual setback or robbery misfortune is deductible just if the citizen documents an opportune case for any protection covering the misfortune. Code Section 165 (h) (5) (E).

Citizens guaranteeing loss and burglary misfortunes must document Form 4684, Casualties and Thefts, with their government forms to guarantee the conclusion. The IRS has additionally made accessible two exercise manuals, IRS Publication 584, Casualty, Disaster, and Theft Workbook, and IRS Publication 584B, Business Casualty, Disaster, and Theft Workbook, which contain plans used to register individual and business loss and robbery misfortunes, separately.