Thanks Carl! Yes, I'm declaring the loss on form 4684 (Casualty and Theft worksheet), which transfers to 4797, and I reduced the cost basis by the depreciation that has been taken on the structure up to the date of the fire. I also entered the insurance reimbursement on for 4684. These figures drove a significant tax liability (not surprised). So then we sold the land roughly 6 months after the fire. Do I enter this sale on another 4797? This is where I'd like to add in the unclaimed depreciation value of the structure to the cost basis of the land as that will show the sale of the land was for a loss and helps reduce the tax liability of the large gain from the insurance reimbursement vs the structure value.
Would it be easier to only "sell" this complete property and say the sale value was the insurance reimbursement plus the land sale and use the full land and depreciated structure value as the cost basis?
Thank you for the help!
