A. Yes. As with a personal theft loss, the amount of the loss is generally treated as a deductible casualty and theft loss, reduced by the amount of any insurance reimbursements. But you could run into a problem if the IRS ever challenges your claim. Keep copies of police reports and other supporting documentation.
Tip: Unlike personal casualty and theft losses, no limits apply to business theft losses. For 2010, personal losses, reduced by $100 per event (down from $500 in 2009), are deductible to the extent they exceed 10% of AGI.