How do I document this sale in Turbo Tax, to avoid paying the taxes on involuntary gain.
I am assuming the fire, as well as the total loss insurance payout occurred in 2021. If so, did you sell the land? If so, did you sell it in the same tax year?
Remember, while it's a total loss to the insurance company, it's not a total loss to you. The insurance does not cover the land. Only the structure. That's why it's a total loss for the insurance company, but not for you. You still own the land.Unless you sold it of course.
