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A quick question on my first year itemizing taxes.

Details-

My mother gifted me a car upon graduation in 2003.

It was stolen Dec. 26th, 2006.

I received insurance reimbursement for the Dec. 2006 NADA car value in Feb. 2007, which is a reasonable estimate of FMV of the car at the time of the theft.

Going through Turbotax, I'm prompted to enter the cost of the car, and any insurance reimbursement. Four questions:

1) If the reimbursement had multiple components, including FMV of car, cost of title/plates, sales tax reimbursement, car rental reimbursement, and comprehensive deductible, if the reported reimbursement the total payment, or just the car value component?

2) If the car was gifted to me, does this make the cost $0, or the FMV of the car at the time of gifting?

3) If $0, after my insurance reimbursement, does this mean that I have a taxable insurance gain that I need to report as income per IRS Form 4864? That seems a little crazy since I paid already-taxed income into an insurance premium to cover such a loss...

4) If the theft was in 2006, but the reimbursement was in 2007, what year should this be reported, if neccessary at all, on my taxes?

Thanks in advance!

Jeff
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2) If the car was gifted to me, does this make the cost $0, or the FMV of the car at the time of gifting?

A gift's cost basis is the lower of its purchase price or the FMV at the time of the gift.

With three years depreciation and additional mileage, it is very unlikely that your insurance settlement exceeded the value of the car at the time of the gift which means that there is no reportable income.

Debra
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No. of Recommendations: 1
A quick question on my first year itemizing taxes.

Details-

My mother gifted me a car upon graduation in 2003.

It was stolen Dec. 26th, 2006.

I received insurance reimbursement for the Dec. 2006 NADA car value in Feb. 2007, which is a reasonable estimate of FMV of the car at the time of the theft.


If you were reimbursed for the FMV of the car you have no tax deduction, particularly after the deductible and your Itemized Deductions would have to exceed your Standard Deduction to be worth anything.

ed
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