Save Money The sil­ver lin­ing in a very bad day? Tax breaks

The Denver Post - - BUSINESS -

Tax rules are not on the list of things most peo­ple turn to for com­fort af­ter a bad day. But they can take the st­ing out in a few cases. 1: Some­one stole your stuff The good news: Theft losses that your in­sur­ance com­pany doesn’t re­im­burse you for could be tax-de­ductible. The rub: The loss has to be siz­able for the math to work. If thieves steal your unin­sured $5,000 ring but your ad­justed gross in­come is $75,000, for ex­am­ple, you prob­a­bly can’t take the de­duc­tion.

2: You lent money to a friend or rel­a­tive who never paid you back

The good news: You report it as a short-term cap­i­tal loss on your tax re­turn. The rub: You need writ­ten proof of the loan. 3: You gam­bled and lost The good news: You may be able to deduct your gam­bling losses if you item­ize your de­duc­tions when you file your tax re­turn. The rub: You can’t deduct more than you win. 4: You sold your stock in­vest­ment at a loss The good news: The IRS lets in­vestors use cap­i­tal losses to off­set tax­able cap­i­tal gains, which means a $5,000 loss on a stock you bought could off­set a $5,000 cap­i­tal gain. The rub: If your losses ex­ceed your gains, you could deduct the dif­fer­ence, but only up to $3,000 per year ($1,500 for those mar­ried fil­ing separately).

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