re: Tax question about Casualty & Theft Loss, probably

The lawsuit you mentioned should be public record and would contain that info about the spill. But I'm not so sure that would support a deduction for a casualty loss. Have you considered a civil suit against the seller of property? Did they or should the have known about the spill? I'm just thinking maybe you overpaid for the property because the seller didn't disclose properly. Maybe he didn't have to disclose. Again IDK. Maybe an attorney will chime in here.

Even if you could find a way to support a tax deduction for a casualty loss on your tax return, which I don't think you can, it's not going to generate the refund you are envisioning. Casualty losses need to exceed 10% of your income and only the excess is deductible. And then you have to itemize the excess loss on a Sch A. Your loss keeps getting whittled away. What year would you throw the loss into? The statute of limitations may have even expired on for the year of loss. The IRS won't let you choose the current year because it's works best for you. That's why I asked you how much you think the loss is, because at the end of the day, there tax benefit of a casualty loss may not be that big.

I'm not a lawyer so don't take this as legal advice.