How do I claim and report deductible losses?
If you are planning to deduct your casualty and theft losses, you have to itemize your deductions and use Form 1040 (so you cannot use Form 1040A or Form 1040EZ). Generally, a casualty loss should be claimed and deducted in the year that the casualty occurred, even if you do not repair or replace the property until later. A theft loss, however, should generally be reported in the year you discovered the theft (which may be the same tax year the theft occurred in but, obviously, may be later).
Casualty and theft losses should be calculated on Form 4684, and then reported as deductions on Schedule A and/or as gains on Schedule D.