Question

Adjusted Cost basis: a man crashed his car into a retaining wall. The retaining wall was paid for by his insurance do I need to include that? In the improvements?

Forum|Forum|5 years ago
February 26, 2021
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TurboTax Self Employed Online

Are you referring to the deduction by the driver or owner of the retaining wall?

Driver. Personal casualty losses are no longer deductible for federal purposes unless they occurred in a federally-declared disaster area. Only the out of pocket expense after insurance would be deductible if the accident occurred in a disaster area.

Owner. If this was not a business or rental property, then the rules above apply. If this were a business or rental, you can deduct the amount not covered by insurance as a “repair.”

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