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basis for disposal of rental house which burned down

Level 2

My client's rental house burned down, total loss.  To show the disposal, do I enter zero as sales price or enter the insurance payment?


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2 Comments 2
Level 15
Level 15

Involuntary conversion section 1033, are they going to rebuild with the insurance money?

Level 11
Level 11

Go through the casualty loss workflow and worksheet. Find out the specifics of the insurance settlement. There are usually several components... fire damage, loss of rents or business income. 
There can be a taxable gain depending on the circumstances 


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