There is a distinction between a capital expense — which increases your cost base of a property for capital gains tax — and a current expense, which is a repair. (moneysense.ca)
The amount of your theft loss is generally the adjusted basis of your property because the fair market value of your property immediately after the theft is considered to be zero. (money.stackexchange.com)
This rule means you have to look carefully at the tax basis of property that may be part of a settlement. (turbotax.intuit.com)