Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. From the amount claimed as an unreimbursed loss you first subtract 10% of your adjusted gross income and then subtract a further $100 for each loss event. To prove the loss you should be able to show all of the following: (1) the date of the loss (2) that the loss was a direct result of the flood (3) that yopu owned the property or were contractually liable for the damage (4) whether a claim for reimbursement exists for which there is a reasonable expectation of recovery.

To figure the amount of the loss:

1. Determine your adjusted basis in the property before the flood.
2. Determine the decrease in Fair Market Value (FMV) of the property as a result of the flood.
3. From the smaller of the amounts in (a) and (b) above, subtract any insurance or other reimbursement you received or expect to receive.

To figure the decrease in FMV you generally need a competent written appraisal of the FMV of the property immediately before and after the flood. Before and after photographs are also useful as additional proof.

(Note- if your reimbursement is more than your adjusted basis in the property, you may have a taxable gain.)

The cost of cleaning up and making repairs is not part of your flood loss, but it may be used as a measure of the decrease in FMV provided you meet all of the following conditions:

The repairs were actually made, are necessary to take care of the damage only, do not cost an excessive amount, and the property after the repairs is not worth more than it was before the damage.

The loss on landscaping may be measured by what you spent on: removing or pruning damaged trees and shrubs (minus any salvage value) and replacement replanting.

Items which do NOT count as part of your loss include:

The cost of protection such as boarding up openings or building a dike, temporary housing or car rentals, the cost of replacing damaged property, and the cost of photographs and appraisals are not considered as part of the loss. However, the cost of photographs and appraisals may be claimed elsewhere on your tax return.