Casualty Gain - How to report on Form 1040
Hello:
I need some guidance on how to report a casualty gain on Form 1040. I do not see this situation very often. My client owns a residential rental house (occupied by a family member who does pay rent) which was partially destroyed by an electrical fire. The house was purchased in 2011 and has an adjusted basis of $66,694.00. The decrease in fair market value after the fire was $ 33,413.00. The insurance reimbursement was $108,010.14. The house has now been repaired at a cost of $ 108,332.39. What amount is reported as taxable gain on Form 4797? Thank you.
