New IRS Guidelines Provide Relief for Homeowners with “Chinese Drywall”

As we'll soon be in tax preparation mode, I thank my friend Donna DiMaggio Berger (www.canfl.com) for the following information:

The Internal Revenue Service recently issued guidelines providing relief to homeowners who have suffered property losses due to the effects of certain imported drywall installed in homes between 2001 and 2009.

Revenue Procedure 2010-36 enables affected taxpayers to treat damages from corrosive drywall as a casualty loss and provides a "safe harbor" formula for determining the amount of the loss.

A taxpayer who has been fully reimbursed before filing a return for the year the loss was sustained may not claim a loss. A taxpayer who has a pending claim for reimbursement (or intends to pursue reimbursement) may have income or an additional deduction in subsequent taxable years depending on the actual amount of reimbursement received.  Please see click here for further details.