Personal theft losses generally aren’t deductible unless they’re attributable to a federally declared disaster. Even then, the write-off is available only to itemizers and is reduced by $100 per event and 10% of adjusted gross income. The One Big Beautiful Bill Act makes the federally declared disaster requirement permanent but, starting in 2026, expands eligibility to qualifying state-declared disasters. Also, an important exception applies if you have personal casualty gains (insurance proceeds exceeding your property’s basis). Theft losses can offset such gains even without a disaster declaration. Contact us for help navigating the rules and maximizing any available tax benefit.
