Where do you enter in the insurance proceeds for a business asset that was lost/destroyed? Turbo Tax never comes back to get the information.

[Max Dog]

I had a business asset being depreciated. It was destroyed two years into depreciation. I received insurance proceeds for the loss. I "Yes" indicated that it was lost or destroyed. 

Turbo Tax says "If you disposed of this property by any of the above means, enter your sales information later in the interview under "Business Income/Sale of Business Property."

There is NO "Business Income / Sale of Business Property" topic or section. I have gone through it many times. There is just 1099-NEC, 1099 and other income. Nothing about sale of business property. 

[MonikaK1 · Accepted solution]

If your business property was destroyed due to a casualty, you can report the loss in the Casualty Loss section of TurboTax.

A casualty loss can result from the damage, destruction, or loss of your property from any sudden, unexpected, or unusual event such as a flood, hurricane, tornado, fire, earthquake, or volcanic eruption. A casualty doesn't include normal wear and tear or progressive deterioration.

The requirements for each type of loss vary. For more information, see Publication 547 or refer to the Instructions for Form 4684.

To report the loss of business property due to a casualty in TurboTax Online:

1. Go to Deductions & Credits
2. Select Disasters, theft, and other property loss or damage
3. Click to add a casualty or theft
4. Fill in the Description of the event (e.g., "fire", "theft")
5. Fill in the date
6. Select Income-Producing Property as the Property Type
7. Choose "no" when asked if it was used in a passive activity (assuming it's used in your Schedule C business)
8. Enter the description of the property, date acquired, cost basis (for business property, your adjusted basis after depreciation), and any insurance reimbursement
9. Enter fair market value before and after the casualty (if lost due to theft, value after is 0)
10. Select "I used this property in my business"
11. Select Done

When you preview your return, look for the loss to appear on Form 4797.

See here for more information from the IRS on this topic. 

[Max Dog]

Thanks for the quick reply. I will check it out.

[Max Dog]

This worked however it was more complicated. Turbo Tax also created asset sale form in addition to the loss. This double counted the loss. There is no easy access to the sale form in TurboTax and no way to delete a sale via main Turbo Tax screens. It had to be manually deleted which is a whole another endeavor in of itself.