How to Report a Robbery Loss on Taxes

Theft losses are deductible losses.

The Internal Revenue Service (IRS) allows taxpayers to deduct theft losses. If a person has a theft loss they want to deduct, he will need to itemize his taxes. If he does not have enough deductions to itemize, then the taxpayer should just take his standard deduction. Filing theft loss deductions requires the use of Form 4684 and Form 1040 Schedule A. It is important the taxpayer properly reports the theft loss to avoid an audit.

Instructions

1. Fill out Form 4684. This form will describe the property you had stolen and the amount you can deduct. The form is pretty self-explanatory. For line 5, the fair value before theft is how much the item would be worth if you sold it to a third party before it was stolen. For line 6, the fair value after theft will equal zero.

2. Enter the amount determined on Form 4684 on line 20 of Form 1040 Schedule A.

3. Attach Form 4684 to Form 1040 Schedule A.

References

• IRS: Form 1040 Schedule A
• IRS: Form 1040 Schedule A Instructions
• IRS: Form 4684