The Internal Revenue Service (IRS) has issued guidance providing relief to homeowners who have suffered property losses from corrosive imported drywall installed in homes between 2001 and 2009. Revenue Procedure 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.
In numerous instances, homeowners with certain imported drywall have reported blackening or corrosion of copper electrical wiring and copper components of household appliances, as well as the presence of sulfur gas odors.
In November 2009, the Consumer Product Safety Commission reported that an indoor air study of a sample of 51 homes found a strong association between the problem drywall, and levels of hydrogen sulfide and corrosion of metals in those homes.
SOURCE: Internal Revenue Service