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Taking a Tax Deduction for a Casualty or Theft 
 
by kmhagen July 05, 2005

How to Postpone a Gain

You postpone a gain by attaching a statement to your tax return for the year in which you have a gain, indicating that you choose to postpone it.  This statement should show:

  • date and details of the casualty or theft
  • insurance or other reimbursement you received
  • how you calculated the gain

If you acquire replacement property before you file your return, this statement should also include detailed information about:

  • the replacement property
  • the postponed gain
  • the basis adjustment in the replacement property that reflects the postponed gain
  • any gain you are reporting as income.

If you have not yet acquired replacement property by the time you file your return, the statement should indicate your intention of acquiring replacement property within the period allowed.

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