Example.
A hailstorm damages your home and your car. Determine the amount of loss, as discussed earlier, for each of these items. Since the losses are due to a single event, you combine the losses and reduce the combined amount by $100.
Single event. Generally, events closely related in origin cause a single casualty. It is a single casualty when the damage is from two or more closely related causes, such as wind and flood damage caused by the same storm.
10% Rule
You must reduce the total of all your casualty or theft losses on personal-use property by 10% of your AGI. Apply this rule after you reduce each loss by $100. For more information, see the Form 4684 instructions. If you have both gains and losses from casualties or thefts, see Gains and losses , later.
Example 1.
In June, you discovered that your house had been burglarized. Your loss after insurance reimbursement was $2,000. Your AGI for the year you discovered the theft is $29,500. You first apply the $100 rule and then the 10% rule. Figure your theft loss deduction as follows.
| 1) | Loss after insurance | $2,000 |
| 2) | Subtract $100 | 100 |
| 3) | Loss after $100 rule | $1,900 |
| 4) | Subtract 10% × $29,500 AGI | 2,950 |
| 5) | Theft loss deduction | –0– |
You don't have a theft loss deduction because your loss after you apply the $100 rule ($1,900) is less than 10% of your AGI ($2,950).
