Hi & thanks for using our service. I'll do my best to give you a complete & accurate answer. Please ask me to clarify anything that is not clear.
Can I deduct the $10,000 pay I made to fix the other boat that my boat damaged?
As long as the accident was not due to your WILLFUL act or negligence, the loss is deductible on Form 4684, which becomes an itemized deduction.
Was your boat damaged also?
Yes, it cost me about $6,000 dollars to repair.
Also, if any of the loss was reimbursed by insurance, then to the extent it was reimbursed, it wouldn't be deductible.
No insurance on anything?
Your boat damage would qualify also.
Now, there is a "deductible" for tax purposes, are you aware of that?
What is the deductible? How do I calculate it.
Hold on a minute
There's been a change in the computation I need to check, but the general casualty or theft deduction must exceed 10% of your Adjusted Gross Income.
I need to check on something with respect to the other property you damaged.
Unfortunately, I spoke too quickly re the damage to the other boat. Damage to your boat would qualify as a casualty loss but since you didn't own the other boat, that would not qualify as a casualty loss.
Also, since you just bought your boat, I presume that it cost a lot more than $6,000.
I guess the moral to this story is to make sure a person's insurance is in force. I take it there is no other way to recoup the $10,000 pay I made from the IRS.
You will want to make sure that you include all of the property that was damaged, equipment, fishing gear, everything, in the loss related to your property.
Well, you aren't in the charter business or anything that could related the boat to business, I presume.
No, just a pleasure boat. Most of the damage was to the front.... I used duc tape to get it to dry dock. Thanks for your help. I may need your assistance again because the boat sank a year later, total loss.
If you need to contact me again with any tax or financial questions, you can just ask for "Steve G" at the beginning of your question. Again, please remember to rate my response. Bonuses, where you think they are warranted, and excellent ratings, are always most appreciated. Thanks again for using JustAnswer.com.
Your boat sunk?
Are you still boating? What happened to it to make it sink?
YES!!! I am add-mending my 2010 taxes. It sank in 2011, the fly bridge steering gear broke running it into a rock jetty. It was insured but not enough to fix it.
Gee Whiz, what luck.
Yes, thanks for your help, I will be contacting soon. Excellent service. Stephen G.
Not sure I'd want strike three with that boat!
I agree. bye