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Department of the Treasury 2020 Internal Revenue Service Instructions for Form 4684 Casualties and Thefts (Rev. February 2021)

Section references are to the Internal Revenue Code deduction now makes it advantageous for you Instructions for Form 8949. For additional unless otherwise noted. to itemize. It is advantageous to itemize if the information, see Opportunity Zones Frequently total of the casualty loss deduction and any Asked Questions. other itemized deductions is more than your General Instructions standard deduction (and increased standard Deferral of gain invested in a QOF. If you deduction amount, if applicable). If you itemize, realize a gain from an actual, or deemed, sale Future Developments attach Schedule A (Form 1040) or Schedule A or exchange with an unrelated person and during the 180-day period beginning on the For the latest information about developments (Form 1040-NR), and Form 4684 to your date realizing the gain, invested an amount of related to Form 4684 and its instructions, such amended return. Fill out Form 1040-X to the gain in a QOF, you may be able to elect to as legislation enacted after they were refigure your tax to find your refund. temporarily defer part or all of the gain that published, go to IRS.gov/Form4684. Form 1040-X, Amended U.S. Individual In- would otherwise be included in income. If you come Tax Return. The IRS has started to make the election, the gain is included in What’s New accept electronically filed Forms 1040-X. taxable income only to the extent, if any, that Currently, only tax year 2019 Forms 1040 and the amount of realized gain exceeds the Personal-use property. A new entry space 1040-SR can be amended electronically. aggregate amount invested in a QOF during the has been added to the form for taxpayers who Additional improvements are planned for the 180-day period beginning on the date the gain are reporting a casualty or theft loss attributable future. You can still file a paper Form 1040-X was realized. to a federally declared disaster. For more and should follow the instructions for preparing information, see FEMA disaster declaration and submitting the paper form. For more How to report. Report the gain as it would numbers, later. information, see IRS.gov/Form1040X. otherwise be reported if you were not making the election. Report the election for the amount Special rules and return procedures expan- Limitation on personal casualty and theft invested in a QOF on Form 8949. See Form ded for claiming qualified disaster-related losses. Personal casualty and theft losses of 8949 for how to make the election. You will personal casualty losses. The Taxpayer an individual sustained in a tax year beginning need to attach Form 8997 annually until you Certainty and Disaster Tax Relief Act of 2019, after 2017 are deductible only to the extent dispose of the QOF investment. See the Form and the Taxpayer Certainty and Disaster Tax they're attributable to a federally declared 8997 instructions for more information. Relief Act of 2020 expanded the special rules disaster. Personal casualty and theft losses and return procedures for personal casualty attributable to a federally declared disaster are losses attributable to certain major federal subject to the $500 per casualty limitation. Purpose of Form disasters that were declared in 2018, 2019, and Use Form 4684 to report gains and losses from 2020. An exception to the rule above limiting the personal casualty and theft loss deduction to casualties and thefts. Attach Form 4684 to your Personal casualty losses sustained in tax losses attributable to a federally declared tax return. year 2020 as a result of qualified disaster disaster applies if you have personal casualty losses, may be claimed on Form 4684. See gains for the tax year. In this case, you will Definitions Qualified disaster loss, later, for more reduce your personal casualty gains by any Three types of casualty losses are described in information. casualty losses not attributable to a federally these instructions. declared disaster. Any excess gain is used to Qualified disaster loss. A qualified disaster 1. Federal Casualty Losses. loss is now expanded to include an individual's reduce losses from a federally declared casualty and theft of personal-use property that disaster. 2. Disaster Losses. is attributable to a major disaster that was For more information, see Disaster Losses, 3. Qualified Disaster Losses. declared before February 26, 2021, by the later, the instructions for Line 14, and Pub. 547. President under section 401 of the Stafford Act All three types of losses refer to federally and that occurred on or after December 28, AMT adjustment for standard deduction declared disasters, but the requirements for 2019, and on or before December 27, 2020, made retroactively inapplicable to net each loss vary. A federally declared disaster is and continued no later than January 26, 2021. qualified disaster losses. The AMT a disaster determined by the President of the However, this change does not include those adjustment for the standard deduction doesn't United States to warrant assistance by the losses attributable to a major disaster that has apply to the increase in the standard deduction federal government under the Robert T. been declared only by reason of COVID-19. that is attributable to a net disaster loss. See Stafford Disaster Relief and Emergency Taxpayers who also file the 2020 Form 6251, Assistance Act (Stafford Act). A federally Alternative Minimum Tax for Individuals, later, declared disaster includes (a) a major disaster Reminders for more information. declaration, or (b) an emergency declaration under the Stafford Act. See the 2018 Form 4684 and its Electing large partnership rules repealed. TIP instructions for the special rules Rules relating to electing large partnerships Federal casualty loss. A federal casualty loss regarding your 2018 return. You may have been repealed. References to electing is an individual’s casualty or theft loss of have to file an amended return on Form 1040-X large partnerships have been revised personal-use property that is attributable to a to claim these benefits on your 2018 return. accordingly on Form 4684 and in these federally declared disaster. The casualty loss Form 1040-X is available at IRS.gov/ instructions. See Section B—Business and must occur in a state receiving a federal Form1040X. The 2018 Form 4684 is available Income-Producing Property, later. disaster declaration. If you suffered a federal at IRS.gov/Form4684. casualty loss, you are eligible to claim a Special rules for capital gains invested in casualty loss deduction. If you suffered a How to report the loss on Form 1040-X. You qualified opportunity funds (QOFs). If you casualty or theft loss of personal-use property should adjust your deductions on Form 1040-X. have a capital gain for 2020, you can invest that that was not attributable to a federally declared The Instructions for Form 1040-X show how to gain into a qualified opportunity fund and elect disaster, it is not a federal casualty loss, and do this. Explain the reasons for your adjustment to defer part or all of the gain that you would you may not claim a casualty loss deduction and attach Form 4684 to show how you figured otherwise include in income until December 31, unless the exception applies. See the Caution your loss. See Figuring a Loss in Pub. 547. 2026. You may also be able to permanently under Losses You Can Deduct, later. exclude gain from the sale or exchange of an If the damaged or destroyed property was investment in a QOF if the investment is held for Disaster loss. A disaster loss is a loss that is nonbusiness property and you didn’t itemize at least 10 years. For information about how to attributable to a federally declared disaster and your deductions on your original return, you elect to use these special rules, see the that occurs in an area eligible for assistance must first determine whether the casualty loss

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pursuant to the Presidential declaration. The claim, you can't deduct the full unrecovered property. If the cost of the replacement property disaster loss must occur in a county eligible for amount as a casualty or theft loss and only the is less than the reimbursement received, you public or individual assistance (or both). part of the loss that isn't covered by your must recognize the gain to the extent the Disaster losses are not limited to individual insurance policy is deductible. reimbursement exceeds the cost of the personal-use property and may be claimed for replacement property. individual business or income-producing Related expenses. The related expenses you property and by corporations, S corporations, have due to a casualty or theft, such as If the replacement property or stock is and partnerships. If you suffered a disaster loss, expenses for the treatment of personal injuries acquired from a related person, gain generally you are eligible to claim a casualty loss or for the rental of a car, aren't deductible as can't be postponed by: deduction and to elect to claim the loss in the casualty or theft losses. • Corporations (other than S corporations); preceding tax year. See Disaster Losses, later. Costs for protection against future • Partnerships in which more than 50% of the casualties aren't deductible but should be capital or profits interest is owned by Qualified disaster loss. A qualified disaster capitalized as permanent improvements. An corporations (other than S corporations); or loss is an individual’s casualty or theft loss of example would be the cost of a levee to stop • All other taxpayers, unless the aggregate personal-use property that is attributable to a flooding. realized gains on the involuntarily converted major federal disaster declared by the President property are $100,000 or less for the tax year. under section 401 of the Stafford Act in 2016, This rule applies to partnerships and S as well as from Hurricane Harvey, Tropical Losses You Can't Deduct corporations at both the entity and partner or Storm Harvey, Hurricane Irma, Hurricane Maria, • Money or property misplaced or lost. shareholder level. or from the California wildfires in 2017 and • Breakage of china, glassware, furniture, and January 2018. similar items under normal conditions. For details on how to postpone the gain, see Pub. 547. A qualified disaster loss includes an • Progressive damage to property (buildings, clothes, trees, etc.) caused by termites, moths, individual's casualty or theft of personal-use If your main home was located in a disaster other insects, or disease. See Pub. 547 for property that is attributable to a major federal area and that home or any of its contents were information on the treatment of deteriorating disaster that was declared by the President damaged or destroyed due to the disaster, concrete foundations that contain the mineral under section 401 of the Stafford Act if declared special rules apply. See Gains Realized on pyrrhotite. on or after January 1, 2018, and before Homes in Disaster Areas, later. February 18, 2020, if that loss occurred before • A decline in market value of stock, caused January 19, 2020. However, this change does by disclosure of accounting or other illegal not include those losses attributable to misconduct by the officers or directors of the When To Deduct a Loss California wildfires in January 2018 (which corporation that issues the stock, that was Generally, you can deduct the part of your received special relief in 2018). acquired on the open market for investment. casualty or theft loss that isn't reimbursable in You may be able to deduct it as a capital loss the tax year the casualty occurred or the theft A qualified disaster loss is now expanded to on Schedule D (Form 1040) if the stock is sold was discovered. However, a disaster loss and a include an individual's casualty and theft of or exchanged or becomes completely loss from deposits in insolvent or bankrupt personal-use property that is attributable to a worthless. See chapter 4 of Pub. 550, financial institutions may be treated differently. major federal disaster that was declared before Investment Income and Expenses. See Disaster Losses and Special Treatment for February 26, 2021, by the President under Losses on Deposits in Insolvent or Bankrupt section 401 of the Stafford Act and that Note. Victims of fraudulent investment Financial Institutions, later. occurred on or after December 28, 2019, and schemes can claim a theft loss deduction if on or before December 27, 2020, and certain conditions apply. See Losses From If in the year of the casualty there is a claim continued no later than January 26, 2021. Ponzi-Type Investment Schemes, later, for for reimbursement with a reasonable prospect However, this change does not include those more information. of recovery, the loss is not sustained until you losses attributable to a major disaster that has know with reasonable certainty whether such been declared only by reason of COVID-19. reimbursement will be received. If you aren't If you suffered a qualified disaster loss, you Gain on Reimbursement sure whether part of your casualty or theft loss are eligible to claim a casualty loss deduction, If the amount you receive in insurance or other will be reimbursed, don't deduct that part until to elect to claim the loss in the preceding tax reimbursement is more than the cost or other the tax year when you become reasonably year, and to deduct the loss without itemizing basis of the property, you have a gain. If you certain that it won't be reimbursed. This later tax other deductions on Schedule A (Form 1040). have a gain, you may have to pay tax on it, or year is when your loss is sustained. See Qualified disaster losses, later. See also you may be able to postpone the gain. IRS.gov/DisasterTaxRelief for date-specific If you are reimbursed for a loss you Don't report the gain on damaged, deducted in an earlier year, include the declarations associated with these disasters destroyed, or stolen property if you receive and for more information. reimbursement in your income in the year you property that is similar or related to it in service received it, but only to the extent the deduction or use. Your basis in the new property is the reduced your tax in an earlier year. Losses You Can Deduct same as your basis in the old property. See Lessee's loss in Pub. 547 for special For tax years 2018 through 2025, if you are an Any tangible replacement property held for individual, losses of personal-use property from rules on when to deduct losses from casualties use in a trade or business is treated as similar and thefts to leased property. fire, storm, shipwreck, or other casualty, or theft or related in service or use to property held for are deductible only if the loss is attributable to a use in a trade or business or for investment if: federally declared disaster (federal casualty • The property you are replacing was Disaster Losses loss). See Pub. 547 for more information. damaged or destroyed in a disaster, and A disaster loss is a loss that occurred in an area The area in which the property was determined by the President of the United If the event causing you to suffer a personal • damaged or destroyed was declared by the States to warrant federal disaster assistance casualty loss occurred before January 1, 2018, President of the United States to warrant and that is attributable to a federally declared but the casualty loss was not sustained until federal assistance because of that disaster. disaster. It includes a major disaster or January 1, 2018, or later, the casualty loss is emergency declaration. not deductible. See When To Deduct a Loss, Generally, you must recognize the gain if later, for more information on when a casualty you receive unlike property or money as For a list of federally declared disasters loss is sustained. reimbursement. But you can generally choose TIP and disaster areas, see FEMA.gov/ Disasters. An exception to the rule limiting the to postpone all or part of the gain if, within 2 deduction for personal casualty and years of the end of the first tax year in which ! any part of the gain is realized, you purchase: To determine the amount to deduct for a CAUTION theft losses to federal casualty losses applies where you have personal casualty gains • Property similar or related in service or use disaster loss, you must take into account as to the extent the losses don’t exceed your to the damaged, destroyed, or stolen property; reimbursements any benefits you received or gains. or which you have a reasonable possibility of • A controlling interest (at least 80%) in a receiving from federal or state programs to corporation owning such property. restore your property. If your property is covered by insurance, and your loss is otherwise deductible, you should To postpone all of the gain, the cost of the Disaster year. The disaster year is the tax file a timely insurance claim for reimbursement replacement property must be equal to or more year in which you sustained the loss attributable of your loss. If you don't file a timely insurance than the reimbursement you received for your to a federally declared disaster. Generally, a

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disaster loss is sustained in the year the Your amended return (eliminating the Schedule A and the description, “Net Qualified disaster occurred. However, a disaster loss previous disaster loss election) should refigure Disaster Loss.” may also be sustained in a year after the your tax liability as a result of revoking the 2. Also, enter on the dotted line next to disaster occurred. For example, if a claim for election. You must pay or make arrangements line 16, your standard deduction amount and reimbursement exists for which there is a to pay any tax and interest due as a result of the the description, “Standard Deduction Claimed reasonable prospect of recovery, no part of the revocation. With Qualified Disaster Loss.” loss for which reimbursement may be received is sustained until it can be ascertained with Home made unsafe by disaster. If your 3. Combine these two amounts and enter reasonable certainty whether you will be home was located in a disaster area and your on line 16 of Schedule A and Form 1040 or reimbursed. state or local government ordered you to tear it 1040-SR, line 12. down or move it because it was no longer safe Example. In December 2020, your car was to use as a home due to the disaster, the The AMT adjustment for the standard destroyed in severe flooding that occurred in resulting loss in value is treated as a disaster deduction is made retroactively the area where you live. The area where you loss. The order for you to tear down or move the inapplicable to net qualified disaster lived was designated by the Federal home must have been issued within 120 days losses. See Taxpayers who also file the 2020 Emergency Management Agency (FEMA) to be after the area was officially declared a disaster Form 6251, Alternative Minimum Tax for eligible for public or individual assistance (or area. Individuals, later, for more information. both). You immediately filed a claim for For purposes of figuring the disaster loss, More information. See Pub. 547 for more reimbursement with your insurance company. use the value of your home before you moved it information about disaster losses. There was a reasonable prospect that you or tore it down as its fair market value after the would recover the full amount of your loss. The casualty. claim was settled in January 2021 when your Gains Realized on Homes insurance company reimbursed you for only Qualified disaster losses. A qualified half of your loss. The disaster year is 2021 (not disaster loss is an individual’s casualty or theft in Disaster Areas 2020 when the loss occurred). Your loss was loss of personal-use property that is attributable The following rules apply if your main home was sustained in 2021 because that’s when it to a major disaster declared by the President located in an area declared by the President of became reasonably certain whether you would under section 401 of the Stafford Act in 2016, the United States to warrant federal assistance be reimbursed. You can either deduct the as well as from Hurricane Harvey, Tropical as the result of a disaster, and the home or any unreimbursed loss on your tax return for the Storm Harvey, Hurricanes Irma and Maria, or of its contents were damaged or destroyed due disaster year (2021) or make an election to from the California wildfires in 2017 and to the disaster. These rules also apply to deduct the unreimbursed loss on your tax return January 2018. renters who receive insurance proceeds for for the preceding year (2020). A qualified disaster loss includes an damaged or destroyed property in a rented home that is their main home. If you realize a gain from the individual's casualty or theft of personal-use reimbursement on your casualty loss, property that is attributable to a major federal 1. No gain is recognized on any insurance ! disaster that was declared by the President CAUTION do not report the gain until the year in proceeds received for unscheduled personal which that amount is received. under section 401 of the Stafford Act if declared property that was part of the contents of the on or after January 1, 2018, and before home. Election to deduct loss in the preceding February 18, 2020, if that loss occurred before 2. Any other insurance proceeds you year. If you have a casualty loss from a January 19, 2020. However, this change does receive for the home or its contents are treated federally declared disaster that occurred in an not include those losses attributable to as received for a single item of property, and area warranting public or individual assistance California wildfires in January 2018 (which any replacement property you purchase that is (or both), you can elect to deduct the loss in the received special relief in 2018). See Qualified similar or related in service or use to the home tax year immediately before the disaster year. A disaster loss, earlier, for more information. or its contents is treated as similar or related in list of areas warranting public or individual A qualified disaster loss is now expanded to service or use to that single item of property. assistance (or both) is available at the FEMA include an individual's casualty and theft of Therefore, you can choose to recognize gain website at FEMA.gov/Disasters. personal-use property that is attributable to a only to the extent the insurance proceeds To make this election for a loss in disaster major federal disaster that was declared before treated as received for that single item of year 2020, complete Part I of Section D on your February 26, 2021, by the President under property exceed the cost of the replacement 2019 Form 4684 and attach it to your 2019 section 401 of the Stafford Act and that property. original or amended return that claims the occurred on or after December 28, 2019, and 3. If you choose to postpone any gain from disaster loss. See Section D—Election To on or before December 27, 2020, and the receipt of insurance or other reimbursement Deduct Federally Declared Disaster Loss in continued no later than January 26, 2021. for your main home or any of its contents, the Preceding Tax Year, later. However, this change does not include those period in which you must purchase replacement losses attributable to a major disaster that has property is extended until 4 years after the end You must make an election to deduct a 2020 been declared only by reason of COVID-19. disaster loss on your 2019 return on or before of the first tax year in which any part of the gain the date that is 6 months after the regular due For specific instructions for reporting these is realized. date for filing your original return (without qualified disaster losses see the instructions for Line 11 and Line 15, later. See IRS.gov/ For details on how to postpone gain, see Pub. extensions) for the disaster year. For calendar 547. year individual taxpayers, the deadline for DisasterTaxRelief for date-specific declarations electing to take a 2020 disaster loss on your associated with these disasters and for more Example. Your main home and its contents 2019 tax return is October 15, 2021. information. were completely destroyed in 2020 by a tornado in a federally declared disaster area. In Revoking a prior election to deduct loss Note. You can deduct qualified disaster losses 2020, you received insurance proceeds of in the preceding year. Complete Part II of without itemizing other deductions on $200,000 for the home, $25,000 for Section D if you want to revoke a 2020 disaster Schedule A. Moreover, your net casualty loss unscheduled personal property in your home, year election to deduct a federally declared from these qualified disasters doesn’t need to $5,000 for jewelry, and $10,000 for a stamp disaster loss in the preceding tax year. Attach exceed 10% of your adjusted gross income collection. The jewelry and stamp collection the completed Section D to an amended return (AGI) to qualify for the deduction, but the $100 were kept in your home and were scheduled for the preceding year (that is, to an amended limit per casualty is increased to $500. See property on your insurance policy. No gain is 2019 return for the revocation of a 2020 Increased standard deduction reporting, next, recognized on the $25,000 you received for the disaster year election). See for more information. unscheduled personal property. If you reinvest Section D—Election To Deduct Federally Increased standard deduction reporting. If the remaining proceeds of $215,000 in a Declared Disaster Loss in Preceding Tax Year, you have a net qualified disaster loss on Form replacement home, any type of replacement later. 4684, line 15, and you aren’t itemizing your contents (whether scheduled or unscheduled, Your amended return eliminating the deductions, you can claim an increased or both), you can elect to postpone any gain on election must be filed on or before the date that standard deduction using Schedule A (Form your home, jewelry, or stamp collection. If you is 90 days after the due date for making the 1040) by doing the following. reinvest less than $215,000, any gain is election and on or before the date you file any recognized only to the extent $215,000 1. Enter the amount from Form 4684, return or amended return for the year that exceeds the amount you reinvest in a line 15, on the dotted line next to line 16 on includes the disaster loss. replacement home, any type of replacement contents (whether scheduled or unscheduled,

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or both). To postpone gain, you must purchase example, enter “DR-4412” for North Carolina the replacement property before 2025. Your Specific Instructions Tropical Storm Michael. basis in the replacement property equals its cost decreased by the amount of any postponed gain. Which Sections To Line 1 Complete Describe the type of property (for example, Special Treatment for Use Section A to figure casualty or theft gains furniture, jewelry, car, etc.). If you are reporting and losses for property that isn't used in a trade a loss attributable to a federally declared Losses on Deposits in or business or for income-producing purposes. disaster, and you checked the box and entered Insolvent or Bankrupt Also use Section A to figure casualty or theft the FEMA disaster declaration number in the losses and gains related to the portion of your space provided above line 1, enter the ZIP code Financial Institutions home used for business if you used the for the property most affected on the line for Property A. You can no longer claim a loss on a simplified method to determine your deductible ! deposit in an insolvent or bankrupt expenses for business use of your home. CAUTION financial institution as a personal Use Section B to figure casualty or theft Line 2 casualty or theft loss unless the exception gains and losses for property that is used in a mentioned under the Caution under Losses You Cost or other basis usually means original cost trade or business or for income-producing Can Deduct, earlier, applies. See Pub. 547 for plus improvements. Subtract any postponed purposes. more information. gain from the sale of a previous main home. Special rules apply to property received as a If property is used partly in a trade or gift or inheritance. See Basis Other Than Cost Damage From Corrosive business and partly for personal purposes, in Pub. 551 for details. If you inherited the such as a personal home with a rental unit, property from someone who died in 2010 and Drywall figure the personal part in Section A and the the executor of the decedent's estate made the If you suffered property losses due to the business part in Section B. election to file Form 8939, Allocation of effects of certain imported drywall installed in Use Section C to figure a theft loss Increase in Basis for Property Received From a homes between 2001 and 2009, under a deduction from a Ponzi-type investment Decedent, refer to the information provided by special procedure, you may be able to claim a scheme if you qualify to use Revenue the executor or see Pub. 4895, Tax Treatment casualty loss deduction for amounts you paid to Procedure 2009-20, as modified by Revenue of Property Acquired From a Decedent Dying in repair damage to your home and household Procedure 2011-58, and choose to follow the 2010, available at IRS.gov/Pub/IRS-Prior/ appliances that resulted from corrosive drywall. procedures in the guidance. Section C of Form p4895--2011.pdf. For details, see Special Procedure for Damage 4684 replaces Appendix A in Revenue From Corrosive Drywall under Casualty in Pub. Procedure 2009-20. You don't need to Line 3 547. complete Appendix A. See Losses From Enter on this line the amount of insurance or Because the personal casualty losses Ponzi-Type Investment Schemes, later. other reimbursement you received or expect to claimed under this special procedure Use Section D to elect (or revoke an receive for each property. Include your are not attributable to a federally election) to deduct in the immediately insurance coverage whether or not you are declared disaster, they're only deductible to the preceding tax year a loss that was attributable filing a claim for reimbursement. For example, extent such losses don't exceed your personal to a federally declared disaster and occurred in your car worth $2,000 is totally destroyed in a casualty gains. a federally declared disaster area. flood in an area designated as a federal disaster. You are insured with a $500 Damage From Section A—Personal Use deductible, but decide not to report it to your Property insurance company because you are afraid the Deteriorating Concrete Use a separate column for lines 2 through 9 to insurance company will cancel your policy. In Foundation show each item lost or damaged from a single this case, enter $1,500 on this line. Under a special procedure, you can deduct casualty or theft described on line 1. If more than four items were lost or damaged, use If you expect to be reimbursed but haven't amounts you paid to repair damage to your yet received payment, you must still enter the home caused by a deteriorating concrete additional sheets following the format of lines 1 through 9. expected reimbursement from the loss. If, in a foundation containing the mineral pyrrhotite. later tax year, you determine with reasonable Under this procedure, you treat the amounts Use a separate Form 4684 through line 12 certainty that you won't be reimbursed for all or paid as a casualty loss in the year of payment for each casualty or theft involving property not part of the loss, you can deduct for that year the for amounts paid prior to 2018. For amounts used in a trade or business or for amount of the loss that isn't reimbursed. paid after 2017 and before the last day for filing income-producing purposes. For example, use Types of reimbursements. Insurance is the a timely Form 1040-X for the 2017 tax year, you a separate Form 4684 through line 12 for most common way to be reimbursed for a may treat the amount paid as a casualty loss on property lost or damaged due to Hurricane casualty or theft loss, but if: a timely Form 1040-X for the 2017 tax year. Harvey or Tropical Storm Harvey, Hurricane Part of a federal disaster loan is forgiven, the Irma, Hurricane Maria, or the California wildfires • See Pub. 547 and Revenue Procedure part you don't have to pay back is considered a or attributable to any qualified disaster 2017-60, 2017-50 I.R.B. 559, available at reimbursement; described in Qualified disaster loss, earlier. IRS.gov/IRB/2017-50_IRB#RP-2017-60, as • The person who leases your property must modified by Revenue Procedure 2018-14, Don't include any loss previously deducted make repairs or must repay you for any part of a 2018-9 I.R.B. 378, available at IRS.gov/IRB/ on an estate tax return. loss, the repayment and the cost of the repairs 2018-09_IRB#RP-2018-14, for more are considered reimbursements; information. If you are liable for casualty or theft losses to • A court awards you damages for a casualty If you paid amounts to repair damage to property you lease from someone else, see or theft loss, the amount you are able to collect, a personal residence with a Leased property under Figuring a Loss in Pub. minus lawyers' fees and other necessary deteriorating concrete foundation and 547. expenses, is a reimbursement; You accept repairs, restoration, or cleanup claimed a deduction on an original or amended FEMA disaster declaration numbers. If you • services provided by relief agencies, it is federal income tax return and in a later year are reporting a casualty or theft loss attributable considered a reimbursement; or payments were made to you (or on your behalf to a federally declared disaster, check the box A bonding company pays you for a theft loss, to contractors) by the Connecticut Foundation and enter the DR or EM declaration number • the payment is also considered a Solutions Indemnity Company (CFSIC), you assigned by FEMA in the space provided above reimbursement. must include some or part of the payments in line 1 on your 2020 Form 4684. A list of your gross income. For more information, see federally declared disasters and FEMA disaster Lump-sum reimbursement. If you have a Pub. 547. declaration numbers is available at FEMA.gov/ casualty or theft loss of several assets at the Disasters. same time and you receive a lump-sum The FEMA disaster declaration number reimbursement, you must divide the amount consists of the letters “DR” and four numbers, you receive among the assets according to the or the letters “EM” and four numbers. For

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fair market value of each asset at the time of the FMV are important elements in proving your Line 11 loss. loss. If you sustained a qualified disaster loss, Grants, gifts, and other payments. Grants The appraised value of property including those sustained in 2020, add the and other payments you receive to help you immediately after the casualty must be adjusted amounts on line 4 of all Forms 4684. Compare after a casualty are considered reimbursements (increased) for the effects of any general market the sum with the amount on line 10. If the only if they must be used specifically to repair or decline that may occur at the same time as the amount on line 10 is larger, enter $500 on replace your property. Such payments will casualty or theft. For example, the value of all line 11 of the Form 4684 reporting the qualified reduce your casualty loss deduction. If there nearby property may become depressed disaster losses. are no conditions on how you have to use the because it is in an area where such money you receive, it isn't a reimbursement. occurrences are commonplace. This general If the amount on line 10 is smaller, or if you Use and occupancy insurance. If insurance decline in market value isn't part of the are reporting a disaster loss, enter $100 and reimburses you for your loss of business property's decrease in FMV as a result of the complete the remainder of the form without income, it doesn't reduce your casualty or theft casualty or theft. applying the special rules for qualified disaster loss. The reimbursement is income and is taxed losses. in the same manner as your business income. Replacement cost or the cost of repairs isn't necessarily FMV. However, you may be able to Main home destroyed. If you have a gain use the cost of repairs to the damaged property Line 13 because your main home was destroyed, you as evidence of loss in value if: Enter on this line the amounts from line 4 of all can generally exclude the gain from your • The repairs are actually made; Forms 4684 reporting a gain. income as if you had sold or exchanged your • The repairs are necessary to restore the home. You may be able to exclude up to property to the condition it was in immediately $250,000 of the gain (up to $500,000 if married before the casualty; Line 14 filing jointly). To exclude a gain, you must • The amount spent for repairs isn't excessive; Note. An exception to the rule that disallows a generally have owned and lived in the property • The repairs only correct the damage caused deduction for personal casualty and theft losses as your main home for at least 2 years during by the casualty; and other than those attributable to federally the 5-year period ending on the date it was • The value of the property after the repairs declared disasters applies if you have personal destroyed. For information on this exclusion, isn't, as a result of the repairs, more than the casualty gains reported on line 13 of your Form see Pub. 523, Selling Your Home. value of the property immediately before the 4684. You will deduct the portion of your If you exclude the gain and the entire gain is casualty. personal casualty losses not attributable to a excludable, don't report the casualty on Form federally declared disaster to the extent the loss 4684. If the gain is more than you can exclude, To figure a casualty loss to real estate not doesn't exceed your personal casualty gains. reduce the insurance or other reimbursement used in a trade, business, or for Any remaining personal casualty gains will be by the amount of the exclusion and enter the income-producing purposes, measure the used to reduce the amount of your deductible result on line 3. Attach a statement showing the decrease in value of the property as a whole. All federal casualty losses. full amount of insurance or other reimbursement improvements, such as buildings, trees, and and the amount of the exclusion. You may be shrubs, are considered together as one item. If you have personal casualty losses that are able to postpone reporting the excess gain if Figure the loss separately for other items. For not attributable to a federally declared disaster, you buy replacement property. See Gain on example, figure the loss separately for each such as those described above, use Worksheet Reimbursement and Gains Realized on Homes piece of furniture. 1-1 to calculate the amount you should enter on in Disaster Areas, earlier. Safe harbor methods for determining casu- line 14. Otherwise, add the amounts on line 12 alty and theft losses. See Revenue of all Forms 4684 and enter that total on line 14. Line 4 Procedure 2018-08, 2018-2 I.R.B. 286, available at IRS.gov/IRB/2018-02_IRB, for safe If you are entitled to an insurance payment or Worksheet 1-1. Losses Not harbor methods that you may use in other reimbursement for any part of a casualty determining the amount of your casualty and Attributable to a Federally or theft loss but you choose not to file a claim theft losses for your home and personal for the loss, you can't realize a gain from that Declared Disaster—Line 14 belongings. See Revenue Procedure 2018-09, payment or reimbursement. Therefore, figure 2018-2 I.R.B 290, available at IRS.gov/IRB/ the gain on line 4 by subtracting your cost or 1. Add the amounts from line 12 2018-02_IRB, for the cost indexes safe harbor other basis in the property (line 2) only from the of all Forms 4684 reporting method that you may use to determine the losses not attributable to a amount of reimbursement you actually amount of loss to your home as a result of federally declared received. Enter the result on line 4, but don't Hurricane and Tropical Storm Harvey, disaster ...... 1. enter less than zero. Hurricane Irma, and Hurricane Maria. The cost 2. Add the amounts from line 12 indexes provide tables with cost per square foot of all Forms 4684 reporting If you filed a claim for reimbursement but for Texas, Louisiana, Florida, Georgia, South losses attributable to a didn't receive it until after the year of the Carolina, Puerto Rico, and the U.S. Virgin federally declared casualty or theft, include the gain in your Islands. disaster...... 2. income in the year you received the reimbursement. Safe harbor reporting requirements for 3. Enter the smaller of line 1 or Form 4684. If you use one of the safe harbor line 13 of Form 4684 ...... 3. methods provided in Revenue Procedure Lines 5 and 6 2018-08, you must attach a statement to Form 4. Add lines 2 and 3. Enter the Fair market value (FMV) is the price at which 4684 stating that you used Revenue Procedure result here and on Form 4684, line 14 ...... 4. the property would be sold between a willing 2018-08 to determine the amount of your buyer and a willing seller, each having casualty loss. Include the specific safe harbor knowledge of the relevant facts. The difference method used. If you use the cost indexes safe between the FMV immediately before the harbor method provided in Revenue Procedure casualty or theft and the FMV immediately after 2018-09 to calculate hurricane-related losses, Line 15 represents the decrease in FMV because of the you must attach a statement to Form 4684 casualty or theft. stating that you used Revenue Procedure Note. You will complete line 15 differently 2018-09 to determine the amount of your depending on whether you have a net gain or The FMV of property after a theft is zero if casualty loss. Include the specific table number loss and whether you have a qualified disaster the property isn't recovered. used. When completing Form 4684, do not loss. enter an amount on line 5 or line 6 for each Net gain. If line 13 is more than line 14, you property. Instead, enter the decrease in the FMV is generally determined by a have a net gain. Report the gain as follows. FMV determined in the relevant safe harbor competent appraisal. The appraiser's Combine your short-term gains with your method on line 7. • knowledge of sales of comparable property short-term losses and include the net short-term about the same time as the casualty or theft, gain or (loss) on Schedule D (Form 1040), knowledge of your property before and after the line 4. Estates and trusts include this amount on occurrence, and the methods of determining Schedule D (Form 1041), line 4.

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• Combine your long-term gains with your Section B—Business and • Revenue Ruling 2009-9, 2009-14 I.R.B. 735 long-term losses and include the net long-term (available at IRS.gov/IRB/ gain or (loss) on Schedule D (Form 1040), Income-Producing Property 2009-14_IRB#RR-2009-9). line 11. Estates and trusts include this amount You can no longer claim any • Revenue Procedure 2009-20, 2009-14 I.R.B. on Schedule D (Form 1041), line 11. miscellaneous itemized deductions. As 749 (available at IRS.gov/IRB/ ! 2009-14_IRB#RP-2009-20). The holding period for long-term gains and CAUTION a result, business casualty and theft losses is more than 1 year. For short-term gains losses of property used in performing services • Revenue Procedure 2011-58, 2011-50 I.R.B. and losses, it is 1 year or less. To figure the as an employee cannot be deducted nor 849 (available at IRS.gov/IRB/ holding period, begin counting on the day after applied in the netting process to offset gains. 2011-50_IRB#RP-2011-58). you received the property and include the day the casualty or theft occurred. The rules for electing large partnerships If you qualify to use Revenue Procedure 2009-20, as modified by Revenue Procedure Generally, if you inherit property, you are have been repealed and are not applicable. 2011-58, and choose to follow the procedures considered to have held the property for longer in the guidance, first fill out Section C to than 1 year, regardless of how long you actually Use a separate column of Part I, lines 20 determine the amount to enter on Section B, held it. If you inherited property from someone through 27, to show each item lost or damaged line 28. Skip lines 19 through 27. Section C of who died in 2010 and the executor made the from a single casualty or theft described on Form 4684 replaces Appendix A in Revenue election to file Form 8939, refer to the line 19. If more than four items were lost or Procedure 2009-20. You don't need to information provided by the executor or see damaged, use additional sheets following the complete Appendix A. Pub. 4895, available at IRS.gov/Pub/IRS-Prior/ format of Part I, lines 19 through 27. p4895--2011.pdf, to determine your holding For more information, see the instructions period. Use a separate Form 4684, Section B, Part for Section C, later, and the above revenue Net loss. If line 13 is less than line 14 and you I, for each casualty or theft involving property ruling and revenue procedures. have qualified disaster losses subject to the used in a trade or business or for $500 reduction on line 11 on any Form(s) 4684: income-producing purposes. Use one If you choose not to use the procedures in • Subtract line 13 from line 14. Enter the Section B, Part II, to combine all Sections B, Revenue Procedure 2009-20, you may claim smaller of this difference or the amount on Part I. your theft loss by filling out Section B, lines 19 line 12 of the Form 4684 listing those qualified to 39, as appropriate. disaster losses. The amount is your net For details on the treatment of casualties or qualified disaster loss. Enter this amount on thefts to business or income-producing Section 179 Property of a line 15 and on Schedule A (Form 1040), line 16 property, including rules on the loss of inventory (Schedule A, line 7, for through casualty or theft, see Figuring a Loss in Partnership or S Corporation Form 1040-NR filers), as “Net Qualified Pub. 547. Partnerships and S corporations that have a Disaster Loss.” casualty or theft involving property for which the Complete the rest of Schedule A either by: Home Used for Business or section 179 expense deduction was previously • Itemizing other deductions as usual; or claimed and passed through to the partners or • Including the amount of your standard Rented Out shareholders must not use Form 4684 to report deduction (see the instructions for Forms 1040 If you had a casualty or theft loss involving a the transaction. Instead, see the Instructions for and 1040-SR, line 12, or the instructions for home you used for business or rented out, your Form 4797 for details on how to report it. Form 1040-NR, line 12) on Schedule A, line 16 deductible loss may be limited. First, complete Partners and S corporation shareholders who (Schedule A, line 7, for Form 1040-NR filers), Form 4684, Section B, lines 19 through 26. If receive a Schedule K-1 reporting such a as “Standard Deduction Claimed With Qualified the loss involved a home used for a business transaction should see the Instructions for Form Disaster Loss.” If you are also filing Form 6251, for which you are filing Schedule C (Form 4797 for details on how to figure the amount to see Taxpayers who also file the 2020 Form 1040), Profit or Loss From Business, figure your enter on Form 4684, line 20. 6251, Alternative Minimum Tax for Individuals deductible casualty or theft loss on Form 8829, next. Expenses for Business Use of Your Home (if Line 19 Don’t complete the rest of this section if all you are using Form 8829). Enter on Form 4684, your personal casualty and theft losses are line 27, the deductible loss from Form 8829, If you are claiming a loss from a fraudulent qualified disaster losses subject to the $500 line 35, and “See Form 8829” above line 27. For investment arrangement and you are not filling reduction. a home you rented out or used for a business out Section C, you must enter the name, for which you aren't filing Schedule C (Form taxpayer identification number (if known), and If line 13 is less than line 14 and you have no 1040), see section 280A(c)(5) to figure your address (if known) of the individual or entity that qualified disaster losses subject to the $500 deductible loss. Attach a statement showing conducted the fraudulent arrangement. reduction on line 11 of your Form 4684, your computation of the deductible loss, enter Complete the rest of Section B, Part I. enter -0- and go to line 16 and complete the rest that amount on line 27, and “See attached of the section. statement” above line 27. Line 20 Taxpayers who also file the 2020 Form 6251, Alternative Minimum Tax for If you used the simplified method to Cost or adjusted basis usually means original Individuals. If you filed Schedule A just to determine your deductible expenses for cost plus improvements, minus depreciation claim an increased standard deduction on Form business use of your home for 2020, figure the allowed or allowable (including any section 179 1040 or 1040-SR due to a loss you suffered casualty or theft loss for the home office in expense deduction), amortization, depletion, related to property in a federally declared Section A instead of on Form 8829 and etc. Special rules apply to property received as disaster area, then enter zero on Form 6251, Section B. a gift or inheritance. See Basis Other Than Cost line 2a, and go to line 2b. You will include the in Pub. 551 for details. If you inherited the amount of the standard deduction (before it was Property Used in a Passive Activity property from someone who died in 2010 and increased by any net qualified disaster loss) on the executor of the decedent's estate made the Form 6251, line 3. You should also include on A gain or loss from a casualty or theft of election to file Form 8939, refer to the line 3 of your Form 6251 the standard deduction property used in a passive activity isn't taken information provided by the executor or see amount you listed on the dotted line next to into account in determining the loss from a Pub. 4895, available at IRS.gov/Pub/IRS-Prior/ Schedule A (Form 1040), line 16, as your passive activity unless losses similar in cause p4895--2011.pdf. “Standard Deduction Claimed With Qualified and severity recur regularly in the activity. See Form 8582, Passive Activity Loss Limitations, Disaster Loss.” Line 21 If you filed Schedule A to itemize your and its instructions for details. deductions, then don’t make this adjustment. See the instructions for Line 3, earlier. Losses From Ponzi-Type Line 17 Investment Schemes Line 22 Estates and trusts figure AGI in the same way The IRS has issued the following guidance to See the instructions for Line 4, earlier. as individuals, except that the costs of assist taxpayers who are victims of losses from administration are allowed in figuring AGI. Ponzi-type investment schemes.

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Lines 23 and 24 On line 34, enter the part of line 22 that is • Revenue Ruling 2009-9, 2009-14 I.R.B. 735 from property held for more than 1 year. (available at IRS.gov/IRB/ See the instructions for Lines 5 and 6 for details 2009-14_IRB#RR-2009-9). on determining FMV. • Revenue Procedure 2009-20, 2009-14 I.R.B. Line 30 Loss on each item figured separately. 749 (available at IRS.gov/IRB/ Unlike a casualty loss to personal-use real Include in the total any amounts from the 2009-14_IRB#RP-2009-20). estate, in which all improvements are additional sheet you attached because you had • Revenue Procedure 2011-58, 2011-50 I.R.B. considered one item, a casualty loss to more than two casualties or thefts on line 29. 849 (available at IRS.gov/IRB/ business or income-producing property must be 2011-50_IRB#RP-2011-58). figured separately for each item. For example, if Line 31 Don't fill out Section C if you don't casualty damage occurs to both a building and ! qualify to use the procedures in to trees on the same piece of real estate, If Form 4797, Sales of Business Property, isn't CAUTION Revenue Procedure 2009-20, as measure the loss separately for the building and otherwise required, enter the amount from this modified by Revenue Procedure 2011-58, or for the trees. line on your Schedule 1 (Form 1040), line 4. you don't choose to follow them. Instead, go to Next to that line, enter “Form 4684.” the instructions for Section B. Line 28 Line 32 If the amount on line 28 includes losses on Line 40 property held 1 year or less, and losses on Estates and trusts, enter the amount from property held for more than 1 year, you must line 32 on the “Other deductions” line of your Enter the initial amount of cash or basis of allocate the amount between lines 29 and 34 tax return. Partnerships, enter on Form 1065, property that you invested in the investment according to how long you held each property. Schedule K, line 13d. S corporations, enter on arrangement. Don't include any of the following Enter on line 29 all gains and losses on property Form 1120-S, Schedule K, line 12d. Next to that on this line, line 41, or line 42. held 1 year or less. Enter on line 34 all gains line, enter “Form 4684.” • Amounts borrowed from the responsible and losses on property held more than 1 year, group and invested in the specified fraudulent except as provided in the instructions for arrangement, to the extent the borrowed line 33. Line 33 amounts weren't repaid at the time the theft was If you had a casualty or theft gain from certain discovered. If you are claiming a theft loss from a trade, business, or income-producing property • Amounts such as fees that were paid to the Ponzi-type investment scheme and are held more than 1 year, you may have to responsible group and deducted for federal following the procedures in Revenue Procedure recapture part or all of the gain as ordinary income tax purposes. 2009-20, 2009-14 I.R.B. 749, enter on line 28 income. See the instructions for Form 4797, • Amounts reported to you (the qualified the amount from Section C, line 51. Don't Part III, for more information on the types of investor) as taxable income that weren't complete Section B, lines 19 through 27, of property subject to recapture. If recapture included in gross income on the investor's Form 4684 for that loss. You must fill out applies, complete Form 4797, Part III, and this federal income tax returns. Section B, Part II. line, instead of Form 4684, line 34. • Cash or property that you (the qualified investor) invested in a fund or other entity (separate from you (the qualified investor) for Part II, Column (a) Line 35 federal income tax purposes) that invested in a specified fraudulent arrangement. On lines 29 and 34, use a separate line to Include in the total any amounts from the identify each casualty or theft. If you have more additional sheet you attached because you had than two casualties or thefts, attach an more than two casualties or thefts. For definitions of responsible group, additional sheet following the format of lines 29 specified fraudulent arrangement, and qualified and 34. investor, see Section 4 of Revenue Procedure Line 38a 2009-20. Example. Ishmael is claiming two casualty losses for his business property. One loss is Taxpayers, other than partnerships and S due to a fire in July and the other loss is due to corporations, if Form 4797 isn't otherwise Line 41 a hurricane in October. He fills out one required, enter the amount from this line on the Section B, Part I, for the fire and another appropriate line for the form you are filing. Enter the amounts of cash or the basis of property that you invested after you made the separate Section B, Part I, for the hurricane. He Form 1040, 1040-SR, or 1040-NR filers. held the property for 1 year or less. He fills out initial investment (including amounts Enter this amount on your Schedule 1 (Form reinvested). only one Section B, Part II, to summarize the 1040), line 4. Next to that line, enter “4684.” two losses he is claiming. On line 29, he enters “Fire” on the first line and “Hurricane” on the Form 1120, 1120-F, and 1120-POL filers. Line 42 second line. See the instructions for Schedule D (Form 1120) for where to report this amount. Enter the total amounts of net income (for If you are claiming a theft loss from a example, interest and dividends minus TIP Ponzi-type investment scheme, enter Section C—Theft Loss expenses) from the specified fraudulent the name of the individual or entity that Deduction for Ponzi-Type arrangement that, consistent with information conducted the fraudulent arrangement. received from that arrangement, you included in Investment Scheme Using the income for federal tax purposes for all tax years Procedures in Revenue before the discovery year, including tax years Part II, Column (b)(i) for which a refund is barred by the statute of Procedure 2009-20 limitations. Enter the part of line 28 from trade, business, Fill out Section C if you claim a theft loss rental, or royalty property. deduction for a Ponzi-type investment scheme Discovery year. The discovery year is the tax and you meet both of the following conditions. year when one of the following occurs. Part II, Column (b)(ii) • You qualify to use Revenue Procedure • The indictment, information, or complaint 2009-20, as modified by Revenue Procedure described in section 4.02(1) or (2) of Revenue Enter the part of line 28 from income-producing 2011-58. Procedure 2009-20 (as modified by Revenue property. Income-producing property is property • You choose to follow the procedures in the Procedure 2011-58) is filed. held for investment, such as stocks, notes, guidance. • The complaint or similar document bonds, gold, silver, vacant lots, and works of described in section 4.02(3) of Revenue art. If you meet both conditions, fill out Section C Procedure 2009-20 (as modified by Revenue in lieu of Appendix A in Revenue Procedure Procedure 2011-58) is filed, or the death of the 2009-20. lead figure occurs, whichever is later. Part II, Column (c) On line 29, enter the part of line 22 that is from For more information about claiming a theft property held for 1 year or less. loss deduction from a Ponzi-type investment Line 44 scheme, see the following guidance. Enter the total amount of cash or property that you withdrew from the investment arrangement

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in all years (whether designated as income or Part II amended return for the disaster year on which principal). you claim the disaster loss. Read the statements and declarations in this part carefully. Enter the required information in You can revoke the prior election on or Line 45 the spaces provided. You are agreeing to these before the date that is 90 days after the due This is the amount of your investment that is statements and declarations when you sign date for making the election. eligible for a deduction before any actual or your tax return. The information you enter in this potential recoveries are taken into account. part will be used to verify the fraudulent Paperwork Reduction Act Notice. We ask investment arrangement. for the information on this form to carry out the Section D—Election To Deduct Internal Revenue laws of the United States. You Line 46 are required to give us the information. We Federally Declared Disaster Potential third-party recovery. This is the need it to ensure that you are complying with amount of all actual or potential claims for Loss in Preceding Tax Year these laws and to allow us to figure and collect the right amount of tax. recovery, as of the last day of the discovery Read the discussion under Disaster Losses, year (defined earlier), that are not from earlier. Then fill out Section D if you want to You aren't required to provide the potential insurance or Securities Investor elect to deduct a disaster loss on your tax return information requested on a form that is subject Protection Corporation (SIPC) recovery, or a for the preceding year. You may also fill out to the Paperwork Reduction Act unless the form potential direct recovery. Section D if you want to revoke a previous displays a valid OMB control number. Books or election to deduct a disaster loss in the tax year Potential insurance/SIPC recovery. This is records relating to a form or its instructions immediately preceding the disaster year. the total of all actual or potential claims for must be retained as long as their contents may reimbursement that, as of the last day of the become material in the administration of any discovery year, are attributable to: Part I—Election Statement Internal Revenue law. Generally, tax returns • Insurance policies in your name that protect and return information are confidential, as you from this type of loss; Fill out Part I if you want to make an election to required by section 6103. deduct a loss attributable to a federally • Contractual arrangements, other than The time needed to complete and file this insurance, that guaranteed or otherwise declared disaster and that occurred in a federally declared disaster area in the tax year form will vary depending on individual protected against this type of loss; or circumstances. The estimated burden for • Amounts payable from SIPC, as advances immediately preceding the tax year the loss was sustained. By making this election, you individual taxpayers filing this form is approved for customer claims under the Securities under OMB control number 1545-0074 and is Investor Protection Act of 1970, or by a similar agree not to deduct the loss for the disaster year. included in the estimates shown in the entity under a similar provision. instructions for their individual income tax Potential direct recovery. This is the amount return. The estimated burden for all other Attach Section D to your original return or taxpayers who file this form is shown below. of all actual or potential claims for recovery, as amended return for the tax year immediately of the last day of the discovery year (defined preceding the tax year the loss was sustained earlier), against the responsible individual or to claim the disaster loss deduction. Recordkeeping...... 2 hr., 37 min. group. Learning about the You must make this election on or before law or the form ...... 24 min. Line 48 the date that is 6 months after the regular due Enter the amounts you actually received as a date for filing your original return (without Preparing the form ... 1 hr., 58 min. reimbursement or recovery from any source. extensions) for the disaster year. Don't include amounts that are potential direct Copying, assembling, recoveries (defined earlier) or potential Part II—Revocation of Prior and sending the form third-party recoveries (defined earlier). Election to the IRS ...... 1 hr., 3 min. Line 49 Fill out Part II if you want to revoke a prior election to deduct a loss attributable to a Enter the amount of potential insurance/SIPC federally declared disaster and that occurred in If you have comments concerning the recovery (defined earlier). a federally declared disaster area in the tax accuracy of these time estimates or year immediately preceding the tax year the suggestions for making this form simpler, we loss was sustained. would be happy to hear from you. See the Line 51 instructions for the tax return with which this Enter the amount from line 51 on line 28 of Attach Section D to your amended return for form is filed. Section B. Don't complete lines 19 through 27 the tax year immediately preceding the tax year for this loss. Then complete Section B, Part II. the loss was sustained to remove the previous If you had other casualties or thefts, fill disaster loss deduction. You must file this TIP out a separate Section B, Part I, for amended return for the preceding year on or them. before the date you file the original return or

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