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Dear Liz: My home in Pacific Palisades is still standing after January’s fire, but was damaged by smoke and ash. The remediators deemed hundreds of personal property items unsalvageable. Our insurance company is paying us a highly depreciated amount for these items, with the full amount to be received upon the actual purchase of each replacement.

Since we won’t replace every item, we’ll end up with a sizable loss, which I understand can be claimed on our 2024 or 2025 tax return. I’m concerned that we won’t know the total amount of loss by the end of 2025. Could you please discuss how to handle this?

Answer: Casualty losses are deductible in the year you sustained the loss. That’s

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