Instructions For Form 4684 - Casualties And Thefts

Line 19

Line 23

Schedule K, line 13d. Electing large

partnerships, enter on Form 1065-B, Part

Estates and trusts figure adjusted gross

Cost or adjusted basis usually means

II, line 11. S corporations, enter on Form

income in the same way as individuals,

original cost plus improvements, minus

1120S, Schedule K, line 12d. Next to that

except that the costs of administration are

depreciation allowed or allowable

line, enter “Form 4684.”

allowed in figuring adjusted gross income.

(including any section 179 expense

deduction), amortization, depletion, etc.

Line 36

Section B—Business and

Special rules apply to property received

If you had a casualty or theft gain from

Income-Producing Property

as a gift or inheritance. See Pub. 551 for

certain trade, business, or

Use a separate column of Part I, lines 22

details.

income-producing property held more

through 30, to show each item lost or

Line 24

than 1 year, you may have to recapture

damaged from a single casualty or theft. If

part or all of the gain as ordinary income.

See the instructions for line 3.

more than four items were lost or

See the instructions for Form 4797, Part

damaged, use additional sheets following

Line 25

III, for more information on the types of

the format of Part I, lines 22 through 30.

See the instructions for line 4.

property subject to recapture. If recapture

Use a separate Form 4684, Section B,

applies, complete Form 4797, Part III, and

Lines 26 and 27

Part I, for each casualty or theft involving

this line, instead of Form 4684, line 37.

See the instructions for lines 5 and 6 for

property used in a trade or business or for

Line 41a

income-producing purposes. Use one

details on determining FMV.

Taxpayers, other than partnerships and S

Section B, Part II, to combine all Sections

Loss on each item figured separately.

corporations, if Form 4797 is not

B, Part I.

Unlike a casualty loss to personal use

otherwise required, enter the amount from

real estate, in which all improvements are

For details on the treatment of

this line on page 1 of your tax return, on

considered one item, a casualty loss to

casualties or thefts to business or

the line identified as from Form 4797.

business or income-producing property

income-producing property, including

Next to that line, enter “Form 4684.”

must be figured separately for each item.

rules on the loss of inventory through

For example, if casualty damage occurs

casualty or theft, see Pub. 547.

to both a building and to trees on the

If you had a casualty or theft loss

Paperwork Reduction Act Notice. We

same piece of real estate, measure the

ask for the information on this form to

involving a home you used for business

loss separately for the building and for the

or rented out, your deductible loss may be

carry out the Internal Revenue laws of the

trees.

limited. First, complete Form 4684,

United States. You are required to give us

the information. We need it to ensure that

Section B, lines 22 through 29. If the loss

Line 31

involved a home used for a business for

you are complying with these laws and to

If the amount on line 31 includes losses

which you are filing Schedule C (Form

allow us to figure and collect the right

on property held 1 year or less, and

1040), Profit or Loss From Business,

amount of tax.

losses on property held for more than 1

figure your deductible casualty or theft

You are not required to provide the

year, you must allocate the amount

loss on Form 8829, Expenses for

information requested on a form that is

between lines 32 and 37 according to

Business Use of Your Home. Enter on

subject to the Paperwork Reduction Act

how long you held each property. Enter

Form 4684, line 30, the deductible loss

unless the form displays a valid OMB

on line 32 all gains and losses on

from Form 8829, line 33, and “See Form

control number. Books or records relating

property held 1 year or less. Enter on line

8829” above line 30. For a home you

to a form or its instructions must be

37 all gains and losses on property held

rented out or used for a business for

retained as long as their contents may

more than 1 year, except as provided in

which you are not filing Schedule C (Form

become material in the administration of

the instructions for line 36.

1040), see section 280A(c)(5) to figure

any Internal Revenue law. Generally, tax

Part II, Column (a)

your deductible loss. Attach a statement

returns and return information are

showing your computation of the

Use a separate line for each casualty or

confidential, as required by section 6103.

deductible loss, enter that amount on line

theft.

The time needed to complete and file

30 and “See attached statement” above

this form will vary depending on individual

Part II, Column (b)(i)

line 30.

circumstances. The estimated burden for

Enter the part of line 31 from trade,

individual taxpayers filing this form is

business, rental, or royalty property (other

Note. A gain or loss from a casualty or

approved under OMB control number

than property you used in performing

theft of property used in a passive activity

1545-0074 and is included in the

services as an employee).

is not taken into account in determining

estimates shown in the instructions for

Part II, Column (b)(ii)

the loss from a passive activity unless

their individual income tax return. The

losses similar in cause and severity recur

estimated burden for all other taxpayers

Enter the part of line 31 from

regularly in the activity. See Form 8582,

who file this form is shown below.

income-producing property and from

Passive Activity Loss Limitations, and its

property you used in performing services

Recordkeeping . . . . . . . . 1 hr., 58 min.

instructions for details.

as an employee. Income-producing

property is property held for investment,

Learning about the law or

Section 179 Property of a

such as stocks, notes, bonds, gold, silver,

the form . . . . . . . . . . . . .

27 min.

Partnership or S corporation

vacant lots, and works of art.

Preparing the form . . . . . 1 hr., 7 min.

Partnerships (other than electing large

Line 34

partnerships) and S corporations that

Copying, assembling,

If Form 4797, Sales of Business Property,

have a casualty or theft involving property

and sending the form to

is not otherwise required, enter the

for which the section 179 expense

the IRS . . . . . . . . . . . . . .

34 min.

amount from this line on page 1 of your

deduction was previously claimed and

tax return, on the line identified as from

passed through to the partners or

If you have comments concerning the

Form 4797. Next to that line, enter “Form

shareholders must not use Form 4684 to

accuracy of these time estimates or

4684.”

report the transaction. Instead, see the

suggestions for making this form simpler,

Instructions for Form 4797 for details on

Line 35

we would be happy to hear from you. See

how to report it. Partners and S

the instructions for the tax return with

Estates and trusts, enter on the “Other

corporation shareholders who receive a

which this form is filed.

deductions” line of your tax return.

Schedule K-1 reporting such a transaction

Partnerships (except electing large

should see the Instructions for Form 4797

partnerships), enter on Form 1065,

for details on how to figure the amount to

enter on Form 4684, line 20.

-4-

Instructions For Form 4684 - Casualties And Thefts - 2005 Page 4

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