Insurance payout on repairs count as rental income?

[Account Closed]

I cant find this exactly on the IRS pages, but I have read on some sites that I may have to claim the insurance payment, as rental income, and then the entire cost of the repairs add to normal repair on schedule E. Is this correct? This is my first time doing my taxes with this situation.

A property had a flood (internal 1000 gallon holding tank), the total cost was just under 7000 for repairs, I had a 1K deductible so that is all I had to put in to get it fixed. The insurance company cut me a check for the rest.

[Steven Hamilton II]

Nicholas Quinn,

Yes, the rental loss payments are treated as rental income.

Any other property damage: You must file Form 4684 in regards to any property damage. http://www.irs.gov/pub/irs-pdf/f4684.pdf

-Steven