The IRS issued guidance in Rev. Proc. 2010-36 providing relief to homeowners who have suffered property losses due to the effects of certain imported drywall installed in homes between 2001 and 2008.
Rev. Proc. 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.

 The full text of Rev. Proc. 2010-36 is available on NATP’s website.

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