We lost our home of 10 years in a federally declared wildfire and trying to understand how to file a casualty loss/gain. We purchased the home for 343k + about 30K in improvements so think the cost basis is about 373K. The FMV before the lost i would guess was between 675k-725k as a guestimate based on home sales in the neighborhood. Insurance reimbursed 672K (hit limits on dwelling replacement costs which by them show a 90K not reimbursed because of limits). We rebuilt the generally the same home, on the original lot with roughly same SF etc. for 720K. If if I just use the cost basis and insurance received I calculate a gain of 300K I think (373K cost basis - 672K insurance received), but if i factor in what it cost to replace the home (720K rebuild cost - 672K insurance received) I see it as a loss of 48K. How does the replacement cost factor into this and how should it be reported in turbotax? Does it even need to be reported at all as I thought I read somewhere it's a like replacement? We also had personal contents of 350K but limited by an insurance reimbursement of 250K is that considered a loss? Does it get included with the filing of the home or as a separate item?
