Basis after fire

[Max W]

Client's house burned down in a fire in 2017.   It has been rebuilt.  LY he rented out half his house.

What is the basis?  Is it original purchase basis, just before fire, after fire, or when?

The new house is slightly smaller than the one that burned, but it is essentially the same.

[BulldogTom]

If the insurance company paid for the rebuild and the taxpayer did not kick anything in other than deductibles, then the basis is the same as before the fire (plus any out of pocket improvements after rebuild).

Tom
Longview, TX

[Max W]

2 hours ago, BulldogTom said:

If the insurance company paid for the rebuild and the taxpayer did not kick anything in other than deductibles, then the basis is the same as before the fire (plus any out of pocket improvements after rebuild).

Tom
Longview, TX

Sounds good, Tom.

Thanks

[Lee B]

Here is a lengthy article in The Tax Advisor about this subject:

https://www.thetaxadviser.com/issues/2018/may/casualty-losses-expenditures-sec-162-165.html