No loss can be deducted if the involuntary conversion is a result of casualty or theft.
If the taxpayer receives insurance or other remuneration for lost property that is worth more than the property's adjusted basis (and is not the taxpayers main home), then the difference between the two amounts must be reported as a capital gain. This gain may be deferred if the taxpayer elects to use the proceeds to acquire replacement property that is worth at least as much as the property that was lost.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
involuntary conversion — see conversion Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. involuntary conversion … Law dictionary
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