New IRS Ruling for Homeowners with Corrosive Drywall | Tax Tip of the Week | No. 69

Casualty Loss UpdateThe IRS issued guidance recently in a Rev. Proc. 2010-36 providing relief to homeowners who have suffered property loss due to the effects of certain imported drywall installed in homes between 2001 and 2008.A bit of background first---For years, the tax code has allowed for a potential casualty loss deduction.  In the past, however, losses were limited to “sudden or unexpected” damages due to fires, floods, car accidents, etc.  This is the first time we have ever seen a potential casualty loss deduction due to a “progressive deterioration.”With this ruling, the IRS recognizes that many homeowners with certain imported drywall have reported blackening or corrosion of copper electrical wiring and copper components of household appliances.  There have also been reports of the presence of sulfur gas odors and mold.If you, or anyone you know, have suffered damages from imported drywall then give us a call.  As usual, there is a lot of fine print to review to see if you qualify.  The first requirement is the damages must exceed a $100 or $500 deductible (depending on the year of the claim).  In addition, the loss must exceed the 10% of adjusted gross income (AGI) floor.Give us a call if you think this may help you save a few tax dollars.We’ll keep you posted.You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.Rick Prewitt - the guy behind TTW...until next week.