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Amending 2011 Tax Return

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Amending 2011 Tax Return

Amending 2011 tax return 24. Amending 2011 tax return   Contributions Table of Contents Introduction Useful Items - You may want to see: Organizations That Qualify To Receive Deductible ContributionsTypes of Qualified Organizations Contributions You Can DeductContributions From Which You Benefit Expenses Paid for Student Living With You Out-of-Pocket Expenses in Giving Services Contributions You Cannot DeductContributions to Individuals Contributions to Nonqualified Organizations Contributions From Which You Benefit Value of Time or Services Personal Expenses Appraisal Fees Contributions of PropertyException. Amending 2011 tax return Household items. Amending 2011 tax return Deduction more than $500. Amending 2011 tax return Form 1098-C. Amending 2011 tax return Filing deadline approaching and still no Form 1098-C. Amending 2011 tax return Exception 1—vehicle used or improved by organization. Amending 2011 tax return Exception 2—vehicle given or sold to needy individual. Amending 2011 tax return Deduction $500 or less. Amending 2011 tax return Right to use property. Amending 2011 tax return Tangible personal property. Amending 2011 tax return Future interest. Amending 2011 tax return Determining Fair Market Value Giving Property That Has Decreased in Value Giving Property That Has Increased in Value When To DeductChecks. Amending 2011 tax return Text message. Amending 2011 tax return Credit card. Amending 2011 tax return Pay-by-phone account. Amending 2011 tax return Stock certificate. Amending 2011 tax return Promissory note. Amending 2011 tax return Option. Amending 2011 tax return Borrowed funds. Amending 2011 tax return Limits on DeductionsCarryovers Records To KeepCash Contributions Noncash Contributions Out-of-Pocket Expenses How To Report Introduction This chapter explains how to claim a deduction for your charitable contributions. Amending 2011 tax return It discusses the following topics. Amending 2011 tax return The types of organizations to which you can make deductible charitable contributions. Amending 2011 tax return The types of contributions you can deduct. Amending 2011 tax return How much you can deduct. Amending 2011 tax return What records you must keep. Amending 2011 tax return How to report your charitable contributions. Amending 2011 tax return A charitable contribution is a donation or gift to, or for the use of, a qualified organization. Amending 2011 tax return It is voluntary and is made without getting, or expecting to get, anything of equal value. Amending 2011 tax return Form 1040 required. Amending 2011 tax return    To deduct a charitable contribution, you must file Form 1040 and itemize deductions on Schedule A. Amending 2011 tax return The amount of your deduction may be limited if certain rules and limits explained in this chapter apply to you. Amending 2011 tax return The limits are explained in detail in Publication 526. Amending 2011 tax return Useful Items - You may want to see: Publication 526 Charitable Contributions 561 Determining the Value of Donated Property Form (and Instructions) Schedule A (Form 1040) Itemized Deductions 8283 Noncash Charitable Contributions Organizations That Qualify To Receive Deductible Contributions You can deduct your contributions only if you make them to a qualified organization. Amending 2011 tax return Most organizations other than churches and governments must apply to the IRS to become a qualified organization. Amending 2011 tax return How to check whether an organization can receive deductible charitable contributions. Amending 2011 tax return   You can ask any organization whether it is a qualified organization, and most will be able to tell you. Amending 2011 tax return Or go to IRS. Amending 2011 tax return gov. Amending 2011 tax return Click on “Tools” and then on “Exempt Organizations Select Check” (www. Amending 2011 tax return irs. Amending 2011 tax return gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check). Amending 2011 tax return This online tool will enable you to search for qualified organizations. Amending 2011 tax return You can also call the IRS to find out if an organization is qualified. Amending 2011 tax return Call 1-877-829-5500. Amending 2011 tax return People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-829-4059. Amending 2011 tax return Deaf or hard of hearing individuals can also contact the IRS through relay services such as the Federal Relay Service at www. Amending 2011 tax return gsa. Amending 2011 tax return gov/fedrelay. Amending 2011 tax return Types of Qualified Organizations Generally, only the following types of organizations can be qualified organizations. Amending 2011 tax return A community chest, corporation, trust, fund, or foundation organized or created in or under the laws of the United States, any state, the District of Columbia, or any possession of the United States (including Puerto Rico). Amending 2011 tax return It must, however, be organized and operated only for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. Amending 2011 tax return Certain organizations that foster national or international amateur sports competition also qualify. Amending 2011 tax return War veterans' organizations, including posts, auxiliaries, trusts, or foundations, organized in the United States or any of its possessions (including Puerto Rico). Amending 2011 tax return Domestic fraternal societies, orders, and associations operating under the lodge system. Amending 2011 tax return (Your contribution to this type of organization is deductible only if it is to be used solely for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. Amending 2011 tax return ) Certain nonprofit cemetery companies or corporations. Amending 2011 tax return (Your contribution to this type of organization is not deductible if it can be used for the care of a specific lot or mausoleum crypt. Amending 2011 tax return ) The United States or any state, the District of Columbia, a U. Amending 2011 tax return S. Amending 2011 tax return possession (including Puerto Rico), a political subdivision of a state or U. Amending 2011 tax return S. Amending 2011 tax return possession, or an Indian tribal government or any of its subdivisions that perform substantial government functions. Amending 2011 tax return (Your contribution to this type of organization is only deductible if it is to be used solely for public purposes. Amending 2011 tax return ) Examples. Amending 2011 tax return    The following list gives some examples of qualified organizations. Amending 2011 tax return Churches, a convention or association of churches, temples, synagogues, mosques, and other religious organizations. Amending 2011 tax return Most nonprofit charitable organizations such as the American Red Cross and the United Way. Amending 2011 tax return Most nonprofit educational organizations, including the Boy Scouts of America, Girl Scouts of America, colleges, and museums. Amending 2011 tax return This also includes nonprofit daycare centers that provide childcare to the general public if substantially all the childcare is provided to enable parents and guardians to be gainfully employed. Amending 2011 tax return However, if your contribution is a substitute for tuition or other enrollment fee, it is not deductible as a charitable contribution, as explained later under Contributions You Cannot Deduct . Amending 2011 tax return Nonprofit hospitals and medical research organizations. Amending 2011 tax return Utility company emergency energy programs, if the utility company is an agent for a charitable organization that assists individuals with emergency energy needs. Amending 2011 tax return Nonprofit volunteer fire companies. Amending 2011 tax return Nonprofit organizations that develop and maintain public parks and recreation facilities. Amending 2011 tax return Civil defense organizations. Amending 2011 tax return Certain foreign charitable organizations. Amending 2011 tax return   Under income tax treaties with Canada, Israel, and Mexico, you may be able to deduct contributions to certain Canadian, Israeli, or Mexican charitable organizations. Amending 2011 tax return Generally, you must have income from sources in that country. Amending 2011 tax return For additional information on the deduction of contributions to Canadian charities, see Publication 597, Information on the United States–Canada Income Tax Treaty. Amending 2011 tax return If you need more information on how to figure your contribution to Mexican and Israeli charities, see Publication 526. Amending 2011 tax return Contributions You Can Deduct Generally, you can deduct contributions of money or property you make to, or for the use of, a qualified organization. Amending 2011 tax return A contribution is “for the use of” a qualified organization when it is held in a legally enforceable trust for the qualified organization or in a similar legal arrangement. Amending 2011 tax return The contributions must be made to a qualified organization and not set aside for use by a specific person. Amending 2011 tax return If you give property to a qualified organization, you generally can deduct the fair market value of the property at the time of the contribution. Amending 2011 tax return See Contributions of Property , later in this chapter. Amending 2011 tax return Your deduction for charitable contributions generally cannot be more than 50% of your adjusted gross income (AGI), but in some cases 20% and 30% limits may apply. Amending 2011 tax return See Limits on Deductions , later. Amending 2011 tax return In addition, the total of your charitable contribution deduction and certain other itemized deductions may be limited. Amending 2011 tax return See chapter 29. Amending 2011 tax return Table 24-1 gives examples of contributions you can and cannot deduct. Amending 2011 tax return Contributions From Which You Benefit If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive. Amending 2011 tax return Also see Contributions From Which You Benefit under Contributions You Cannot Deduct, later. Amending 2011 tax return If you pay more than fair market value to a qualified organization for goods or services, the excess may be a charitable contribution. Amending 2011 tax return For the excess amount to qualify, you must pay it with the intent to make a charitable contribution. Amending 2011 tax return Example 1. Amending 2011 tax return You pay $65 for a ticket to a dinner-dance at a church. Amending 2011 tax return Your entire $65 payment goes to the church. Amending 2011 tax return The ticket to the dinner-dance has a fair market value of $25. Amending 2011 tax return When you buy your ticket, you know that its value is less than your payment. Amending 2011 tax return To figure the amount of your charitable contribution, subtract the value of the benefit you receive ($25) from your total payment ($65). Amending 2011 tax return You can deduct $40 as a contribution to the church. Amending 2011 tax return Example 2. Amending 2011 tax return At a fundraising auction conducted by a charity, you pay $600 for a week's stay at a beach house. Amending 2011 tax return The amount you pay is no more than the fair rental value. Amending 2011 tax return You have not made a deductible charitable contribution. Amending 2011 tax return Athletic events. Amending 2011 tax return   If you make a payment to, or for the benefit of, a college or university and, as a result, you receive the right to buy tickets to an athletic event in the athletic stadium of the college or university, you can deduct 80% of the payment as a charitable contribution. Amending 2011 tax return   If any part of your payment is for tickets (rather than the right to buy tickets), that part is not deductible. Amending 2011 tax return Subtract the price of the tickets from your payment. Amending 2011 tax return You can deduct 80% of the remaining amount as a charitable contribution. Amending 2011 tax return Example 1. Amending 2011 tax return You pay $300 a year for membership in a university's athletic scholarship program. Amending 2011 tax return The only benefit of membership is that you have the right to buy one season ticket for a seat in a designated area of the stadium at the university's home football games. Amending 2011 tax return You can deduct $240 (80% of $300) as a charitable contribution. Amending 2011 tax return Table 24-1. Amending 2011 tax return Examples of Charitable Contributions—A Quick Check Use the following lists for a quick check of whether you can deduct a contribution. Amending 2011 tax return See the rest of this chapter for more information and additional rules and limits that may apply. Amending 2011 tax return Deductible As  Charitable Contributions Not Deductible  As Charitable Contributions Money or property you give to:  Churches, synagogues, temples, mosques, and other religious organizations Federal, state, and local governments, if your contribution is solely for public purposes (for example, a gift to reduce the public debt or maintain a public park) Nonprofit schools and hospitals The Salvation Army, American Red Cross, CARE, Goodwill Industries, United Way, Boy Scouts of America, Girl Scouts of America, Boys and Girls Clubs of America, etc. Amending 2011 tax return War veterans groups   Expenses paid for a student living with you, sponsored by a qualified organization  Out-of-pocket expenses when you serve a qualified organization as a volunteer Money or property you give to:  Civic leagues, social and sports clubs, labor unions, and chambers of commerce Foreign organizations (except certain Canadian, Israeli, and Mexican charities) Groups that are run for personal profit Groups whose purpose is to lobby for law changes Homeowners' associations Individuals Political groups or candidates for public office   Cost of raffle, bingo, or lottery tickets  Dues, fees, or bills paid to country clubs, lodges, fraternal orders, or similar groups  Tuition  Value of your time or services  Value of blood given to a blood bank    Example 2. Amending 2011 tax return The facts are the same as in Example 1 except your $300 payment includes the purchase of one season ticket for the stated ticket price of $120. Amending 2011 tax return You must subtract the usual price of a ticket ($120) from your $300 payment. Amending 2011 tax return The result is $180. Amending 2011 tax return Your deductible charitable contribution is $144 (80% of $180). Amending 2011 tax return Charity benefit events. Amending 2011 tax return   If you pay a qualified organization more than fair market value for the right to attend a charity ball, banquet, show, sporting event, or other benefit event, you can deduct only the amount that is more than the value of the privileges or other benefits you receive. Amending 2011 tax return   If there is an established charge for the event, that charge is the value of your benefit. Amending 2011 tax return If there is no established charge, the reasonable value of the right to attend the event is the value of your benefit. Amending 2011 tax return Whether you use the tickets or other privileges has no effect on the amount you can deduct. Amending 2011 tax return However, if you return the ticket to the qualified organization for resale, you can deduct the entire amount you paid for the ticket. Amending 2011 tax return    Even if the ticket or other evidence of payment indicates that the payment is a “contribution,” this does not mean you can deduct the entire amount. Amending 2011 tax return If the ticket shows the price of admission and the amount of the contribution, you can deduct the contribution amount. Amending 2011 tax return Example. Amending 2011 tax return You pay $40 to see a special showing of a movie for the benefit of a qualified organization. Amending 2011 tax return Printed on the ticket is “Contribution—$40. Amending 2011 tax return ” If the regular price for the movie is $8, your contribution is $32 ($40 payment − $8 regular price). Amending 2011 tax return Membership fees or dues. Amending 2011 tax return    You may be able to deduct membership fees or dues you pay to a qualified organization. Amending 2011 tax return However, you can deduct only the amount that is more than the value of the benefits you receive. Amending 2011 tax return    You cannot deduct dues, fees, or assessments paid to country clubs and other social organizations. Amending 2011 tax return They are not qualified organizations. Amending 2011 tax return Certain membership benefits can be disregarded. Amending 2011 tax return   Both you and the organization can disregard the following membership benefits if you receive them in return for an annual payment of $75 or less. Amending 2011 tax return Any rights or privileges, other than those discussed under Athletic events , earlier, that you can use frequently while you are a member, such as: Free or discounted admission to the organization's facilities or events, Free or discounted parking, Preferred access to goods or services, and Discounts on the purchase of goods and services. Amending 2011 tax return Admission, while you are a member, to events open only to members of the organization, if the organization reasonably projects that the cost per person (excluding any allocated overhead) is not more than $10. Amending 2011 tax return 20. Amending 2011 tax return Token items. Amending 2011 tax return   You do not have to reduce your contribution by the value of any benefit you receive if both of the following are true. Amending 2011 tax return You receive only a small item or other benefit of token value. Amending 2011 tax return The qualified organization correctly determines that the value of the item or benefit you received is not substantial and informs you that you can deduct your payment in full. Amending 2011 tax return Written statement. Amending 2011 tax return   A qualified organization must give you a written statement if you make a payment of more than $75 that is partly a contribution and partly for goods or services. Amending 2011 tax return The statement must say that you can deduct only the amount of your payment that is more than the value of the goods or services you received. Amending 2011 tax return It must also give you a good faith estimate of the value of those goods or services. Amending 2011 tax return   The organization can give you the statement either when it solicits or when it receives the payment from you. Amending 2011 tax return Exception. Amending 2011 tax return   An organization will not have to give you this statement if one of the following is true. Amending 2011 tax return The organization is: A governmental organization described in (5) under Types of Qualified Organizations , earlier, or An organization formed only for religious purposes, and the only benefit you receive is an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in commercial transactions outside the donative context. Amending 2011 tax return You receive only items whose value is not substantial as described under Token items , earlier. Amending 2011 tax return You receive only membership benefits that can be disregarded, as described earlier. Amending 2011 tax return Expenses Paid for Student Living With You You may be able to deduct some expenses of having a student live with you. Amending 2011 tax return You can deduct qualifying expenses for a foreign or American student who: Lives in your home under a written agreement between you and a qualified organization as part of a program of the organization to provide educational opportunities for the student, Is not your relative or dependent, and Is a full-time student in the twelfth or any lower grade at a school in the United States. Amending 2011 tax return You can deduct up to $50 a month for each full calendar month the student lives with you. Amending 2011 tax return Any month when conditions (1) through (3) are met for 15 days or more counts as a full month. Amending 2011 tax return For additional information, see Expenses Paid for Student Living With You in Publication 526. Amending 2011 tax return Mutual exchange program. Amending 2011 tax return   You cannot deduct the costs of a foreign student living in your home under a mutual exchange program through which your child will live with a family in a foreign country. Amending 2011 tax return Table 24-2. Amending 2011 tax return Volunteers' Questions and Answers If you volunteer for a qualified organization, the following questions and answers may apply to you. Amending 2011 tax return All of the rules explained in this chapter also apply. Amending 2011 tax return See, in particular, Out-of-Pocket Expenses in Giving Services . Amending 2011 tax return Question Answer I volunteer 6 hours a week in the office of a qualified organization. Amending 2011 tax return The receptionist is paid $10 an hour for the same work. Amending 2011 tax return Can I deduct $60 a week for my time?    No, you cannot deduct the value of your time or services. Amending 2011 tax return The office is 30 miles from my home. Amending 2011 tax return Can I deduct any of my car expenses for these trips? Yes, you can deduct the costs of gas and oil that are directly related to getting to and from the place where you volunteer. Amending 2011 tax return If you don't want to figure your actual costs, you can deduct 14 cents for each mile. Amending 2011 tax return I volunteer as a Red Cross nurse's aide at a hospital. Amending 2011 tax return Can I deduct the cost of the uniforms I must wear? Yes, you can deduct the cost of buying and cleaning your uniforms if the hospital is a qualified organization, the uniforms are not suitable for everyday use, and you must wear them when volunteering. Amending 2011 tax return I pay a babysitter to watch my children while I volunteer for a qualified organization. Amending 2011 tax return Can I deduct these costs? No, you cannot deduct payments for childcare expenses as a charitable contribution, even if you would be unable to volunteer without childcare. Amending 2011 tax return (If you have childcare expenses so you can work for pay, see chapter 32. Amending 2011 tax return ) Out-of-Pocket Expenses in Giving Services Although you cannot deduct the value of your services given to a qualified organization, you may be able to deduct some amounts you pay in giving services to a qualified organization. Amending 2011 tax return The amounts must be: Unreimbursed, Directly connected with the services, Expenses you had only because of the services you gave, and Not personal, living, or family expenses. Amending 2011 tax return Table 24-2 contains questions and answers that apply to some individuals who volunteer their services. Amending 2011 tax return Conventions. Amending 2011 tax return   If a qualified organization selects you to attend a convention as its representative, you can deduct unreimbursed expenses for travel, including reasonable amounts for meals and lodging, while away from home overnight in connection with the convention. Amending 2011 tax return However, see Travel , later. Amending 2011 tax return   You cannot deduct personal expenses for sightseeing, fishing parties, theater tickets, or nightclubs. Amending 2011 tax return You also cannot deduct transportation, meals and lodging, and other expenses for your spouse or children. Amending 2011 tax return    You cannot deduct your travel expenses in attending a church convention if you go only as a member of your church rather than as a chosen representative. Amending 2011 tax return You can, however, deduct unreimbursed expenses that are directly connected with giving services for your church during the convention. Amending 2011 tax return Uniforms. Amending 2011 tax return   You can deduct the cost and upkeep of uniforms that are not suitable for everyday use and that you must wear while performing donated services for a charitable organization. Amending 2011 tax return Foster parents. Amending 2011 tax return   You may be able to deduct as a charitable contribution some of the costs of being a foster parent (foster care provider) if you have no profit motive in providing the foster care and are not, in fact, making a profit. Amending 2011 tax return A qualified organization must select the individuals you take into your home for foster care. Amending 2011 tax return    You can deduct expenses that meet both of the following requirements. Amending 2011 tax return They are unreimbursed out-of-pocket expenses to feed, clothe, and care for the foster child. Amending 2011 tax return They are incurred primarily to benefit the qualified organization. Amending 2011 tax return   Unreimbursed expenses that you cannot deduct as charitable contributions may be considered support provided by you in determining whether you can claim the foster child as a dependent. Amending 2011 tax return For details, see chapter 3. Amending 2011 tax return Example. Amending 2011 tax return You cared for a foster child because you wanted to adopt her, not to benefit the agency that placed her in your home. Amending 2011 tax return Your unreimbursed expenses are not deductible as charitable contributions. Amending 2011 tax return Car expenses. Amending 2011 tax return   You can deduct as a charitable contribution any unreimbursed out-of-pocket expenses, such as the cost of gas and oil, that are directly related to the use of your car in giving services to a charitable organization. Amending 2011 tax return You cannot deduct general repair and maintenance expenses, depreciation, registration fees, or the costs of tires or insurance. Amending 2011 tax return    If you do not want to deduct your actual expenses, you can use a standard mileage rate of 14 cents a mile to figure your contribution. Amending 2011 tax return   You can deduct parking fees and tolls whether you use your actual expenses or the standard mileage rate. Amending 2011 tax return   You must keep reliable written records of your car expenses. Amending 2011 tax return For more information, see Car expenses under Records To Keep, later. Amending 2011 tax return Travel. Amending 2011 tax return   Generally, you can claim a charitable contribution deduction for travel expenses necessarily incurred while you are away from home performing services for a charitable organization only if there is no significant element of personal pleasure, recreation, or vacation in the travel. Amending 2011 tax return This applies whether you pay the expenses directly or indirectly. Amending 2011 tax return You are paying the expenses indirectly if you make a payment to the charitable organization and the organization pays for your travel expenses. Amending 2011 tax return   The deduction for travel expenses will not be denied simply because you enjoy providing services to the charitable organization. Amending 2011 tax return Even if you enjoy the trip, you can take a charitable contribution deduction for your travel expenses if you are on duty in a genuine and substantial sense throughout the trip. Amending 2011 tax return However, if you have only nominal duties, or if for significant parts of the trip you do not have any duties, you cannot deduct your travel expenses. Amending 2011 tax return Example 1. Amending 2011 tax return You are a troop leader for a tax-exempt youth group and you take the group on a camping trip. Amending 2011 tax return You are responsible for overseeing the setup of the camp and for providing adult supervision for other activities during the entire trip. Amending 2011 tax return You participate in the activities of the group and enjoy your time with them. Amending 2011 tax return You oversee the breaking of camp and you transport the group home. Amending 2011 tax return You can deduct your travel expenses. Amending 2011 tax return Example 2. Amending 2011 tax return You sail from one island to another and spend 8 hours a day counting whales and other forms of marine life. Amending 2011 tax return The project is sponsored by a charitable organization. Amending 2011 tax return In most circumstances, you cannot deduct your expenses. Amending 2011 tax return Example 3. Amending 2011 tax return You work for several hours each morning on an archaeological dig sponsored by a charitable organization. Amending 2011 tax return The rest of the day is free for recreation and sightseeing. Amending 2011 tax return You cannot take a charitable contribution deduction even though you work very hard during those few hours. Amending 2011 tax return Example 4. Amending 2011 tax return You spend the entire day attending a charitable organization's regional meeting as a chosen representative. Amending 2011 tax return In the evening you go to the theater. Amending 2011 tax return You can claim your travel expenses as charitable contributions, but you cannot claim the cost of your evening at the theater. Amending 2011 tax return Daily allowance (per diem). Amending 2011 tax return   If you provide services for a charitable organization and receive a daily allowance to cover reasonable travel expenses, including meals and lodging while away from home overnight, you must include in income any part of the allowance that is more than your deductible travel expenses. Amending 2011 tax return You may be able to deduct any necessary travel expenses that are more than the allowance. Amending 2011 tax return Deductible travel expenses. Amending 2011 tax return   These include: Air, rail, and bus transportation, Out-of-pocket expenses for your car, Taxi fares or other costs of transportation between the airport or station and your hotel, Lodging costs, and The cost of meals. Amending 2011 tax return Because these travel expenses are not business-related, they are not subject to the same limits as business-related expenses. Amending 2011 tax return For information on business travel expenses, see Travel Expenses in chapter 26. Amending 2011 tax return Contributions You Cannot Deduct There are some contributions you cannot deduct, such as those made to specific individuals and those made to nonqualified organizations. Amending 2011 tax return (See Contributions to Individuals and Contributions to Nonqualified Organizations , next. Amending 2011 tax return ) There are others you can deduct only part of, as discussed later under Contributions From Which You Benefit . Amending 2011 tax return Contributions to Individuals You cannot deduct contributions to specific individuals, including the following. Amending 2011 tax return Contributions to fraternal societies made for the purpose of paying medical or burial expenses of deceased members. Amending 2011 tax return Contributions to individuals who are needy or worthy. Amending 2011 tax return You cannot deduct these contributions even if you make them to a qualified organization for the benefit of a specific person. Amending 2011 tax return But you can deduct a contribution to a qualified organization that helps needy or worthy individuals if you do not indicate that your contribution is for a specific person. Amending 2011 tax return Example. Amending 2011 tax return You can deduct contributions to a qualified organization for flood relief, hurricane relief, or other disaster relief. Amending 2011 tax return However, you cannot deduct contributions earmarked for relief of a particular individual or family. Amending 2011 tax return Payments to a member of the clergy that can be spent as he or she wishes, such as for personal expenses. Amending 2011 tax return Expenses you paid for another person who provided services to a qualified organization. Amending 2011 tax return Example. Amending 2011 tax return Your son does missionary work. Amending 2011 tax return You pay his expenses. Amending 2011 tax return You cannot claim a deduction for your son's unreimbursed expenses related to his contribution of services. Amending 2011 tax return Payments to a hospital that are for a specific patient's care or for services for a specific patient. Amending 2011 tax return You cannot deduct these payments even if the hospital is operated by a city, a state, or other qualified organization. Amending 2011 tax return Contributions to Nonqualified Organizations You cannot deduct contributions to organizations that are not qualified to receive tax-deductible contributions, including the following. Amending 2011 tax return Certain state bar associations if: The bar is not a political subdivision of a state, The bar has private, as well as public, purposes, such as promoting the professional interests of members, and Your contribution is unrestricted and can be used for private purposes. Amending 2011 tax return Chambers of commerce and other business leagues or organizations (but see chapter 28). Amending 2011 tax return Civic leagues and associations. Amending 2011 tax return Communist organizations. Amending 2011 tax return Country clubs and other social clubs. Amending 2011 tax return Most foreign organizations (other than certain Canadian, Israeli, or Mexican charitable organizations). Amending 2011 tax return For details, see Publication 526. Amending 2011 tax return Homeowners' associations. Amending 2011 tax return Labor unions (but see chapter 28). Amending 2011 tax return Political organizations and candidates. Amending 2011 tax return Contributions From Which You Benefit If you receive or expect to receive a financial or economic benefit as a result of making a contribution to a qualified organization, you cannot deduct the part of the contribution that represents the value of the benefit you receive. Amending 2011 tax return See Contributions From Which You Benefit under Contributions You Can Deduct, earlier. Amending 2011 tax return These contributions include the following. Amending 2011 tax return Contributions for lobbying. Amending 2011 tax return This includes amounts that you earmark for use in, or in connection with, influencing specific legislation. Amending 2011 tax return Contributions to a retirement home for room, board, maintenance, or admittance. Amending 2011 tax return Also, if the amount of your contribution depends on the type or size of apartment you will occupy, it is not a charitable contribution. Amending 2011 tax return Costs of raffles, bingo, lottery, etc. Amending 2011 tax return You cannot deduct as a charitable contribution amounts you pay to buy raffle or lottery tickets or to play bingo or other games of chance. Amending 2011 tax return For information on how to report gambling winnings and losses, see Gambling winnings in chapter 12 and Gambling Losses Up to the Amount of Gambling Winnings in chapter 28. Amending 2011 tax return Dues to fraternal orders and similar groups. Amending 2011 tax return However, see Membership fees or dues , earlier, under Contributions You Can Deduct. Amending 2011 tax return Tuition, or amounts you pay instead of tuition. Amending 2011 tax return You cannot deduct as a charitable contribution amounts you pay as tuition even if you pay them for children to attend parochial schools or qualifying nonprofit daycare centers. Amending 2011 tax return You also cannot deduct any fixed amount you must pay in addition to, or instead of, tuition to enroll in a private school, even if it is designated as a “donation. Amending 2011 tax return ” Value of Time or Services You cannot deduct the value of your time or services, including: Blood donations to the American Red Cross or to blood banks, and The value of income lost while you work as an unpaid volunteer for a qualified organization. Amending 2011 tax return Personal Expenses You cannot deduct personal, living, or family expenses, such as the following items. Amending 2011 tax return The cost of meals you eat while you perform services for a qualified organization unless it is necessary for you to be away from home overnight while performing the services. Amending 2011 tax return Adoption expenses, including fees paid to an adoption agency and the costs of keeping a child in your home before adoption is final (but see Adoption Credit in chapter 37, and the instructions for Form 8839, Qualified Adoption Expenses). Amending 2011 tax return You also may be able to claim an exemption for the child. Amending 2011 tax return See Adopted child in chapter 3. Amending 2011 tax return Appraisal Fees You cannot deduct as a charitable contribution any fees you pay to find the fair market value of donated property (but see chapter 28). Amending 2011 tax return Contributions of Property If you contribute property to a qualified organization, the amount of your charitable contribution is generally the fair market value of the property at the time of the contribution. Amending 2011 tax return However, if the property has increased in value, you may have to make some adjustments to the amount of your deduction. Amending 2011 tax return See Giving Property That Has Increased in Value , later. Amending 2011 tax return For information about the records you must keep and the information you must furnish with your return if you donate property, see Records To Keep and How To Report , later. Amending 2011 tax return Clothing and household items. Amending 2011 tax return   You cannot take a deduction for clothing or household items you donate unless the clothing or household items are in good used condition or better. Amending 2011 tax return Exception. Amending 2011 tax return   You can take a deduction for a contribution of an item of clothing or household item that is not in good used condition or better if you deduct more than $500 for it and include a qualified appraisal of it with your return. Amending 2011 tax return Household items. Amending 2011 tax return   Household items include: Furniture and furnishings, Electronics, Appliances, Linens, and Other similar items. Amending 2011 tax return   Household items do not include: Food, Paintings, antiques, and other objects of art, Jewelry and gems, and Collections. Amending 2011 tax return Cars, boats, and airplanes. Amending 2011 tax return    The following rules apply to any donation of a qualified vehicle. Amending 2011 tax return A qualified vehicle is: A car or any motor vehicle manufactured mainly for use on public streets, roads, and highways, A boat, or An airplane. Amending 2011 tax return Deduction more than $500. Amending 2011 tax return   If you donate a qualified vehicle with a claimed fair market value of more than $500, you can deduct the smaller of: The gross proceeds from the sale of the vehicle by the organization, or The vehicle's fair market value on the date of the contribution. Amending 2011 tax return If the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to figure the deductible amount, as described under Giving Property That Has Increased in Value , later. Amending 2011 tax return Form 1098-C. Amending 2011 tax return   You must attach to your return Copy B of the Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes, (or other statement containing the same information as Form 1098-C) you received from the organization. Amending 2011 tax return The Form 1098-C (or other statement) will show the gross proceeds from the sale of the vehicle. Amending 2011 tax return   If you e-file your return, you must: Attach Copy B of Form 1098-C to Form 8453 and mail the forms to the IRS, or Include Copy B of Form 1098-C as a pdf attachment if your software program allows it. Amending 2011 tax return   If you do not attach Form 1098-C (or other statement), you cannot deduct your contribution. Amending 2011 tax return    You must get Form 1098-C (or other statement) within 30 days of the sale of the vehicle. Amending 2011 tax return But if exception 1 or 2 (described later) applies, you must get Form 1098-C (or other statement) within 30 days of your donation. Amending 2011 tax return Filing deadline approaching and still no Form 1098-C. Amending 2011 tax return   If the filing deadline is approaching and you still do not have a Form 1098-C, you have two choices. Amending 2011 tax return Request an automatic 6-month extension of time to file your return. Amending 2011 tax return You can get this extension by filing Form 4868, Application for Automatic Extension of Time to File U. Amending 2011 tax return S. Amending 2011 tax return Individual Income Tax Return. Amending 2011 tax return  For more information, see Automatic Extension in chapter 1. Amending 2011 tax return File the return on time without claiming the deduction for the qualified vehicle. Amending 2011 tax return After receiving the Form 1098-C, file an amended return, Form 1040X, claiming the deduction. Amending 2011 tax return Attach Copy B of Form 1098-C (or other statement) to the amended return. Amending 2011 tax return For more information about amended returns, see Amended Returns and Claims for Refund in chapter 1. Amending 2011 tax return Exceptions. Amending 2011 tax return   There are two exceptions to the rules just described for deductions of more than $500. Amending 2011 tax return Exception 1—vehicle used or improved by organization. Amending 2011 tax return   If the qualified organization makes a significant intervening use of or material improvement to the vehicle before transferring it, you generally can deduct the vehicle's fair market value at the time of the contribution. Amending 2011 tax return But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. Amending 2011 tax return The Form 1098-C (or other statement) will show whether this exception applies. Amending 2011 tax return Exception 2—vehicle given or sold to needy individual. Amending 2011 tax return   If the qualified organization will give the vehicle, or sell it for a price well below fair market value, to a needy individual to further the organization's charitable purpose, you generally can deduct the vehicle's fair market value at the time of the contribution. Amending 2011 tax return But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. Amending 2011 tax return The Form 1098-C (or other statement) will show whether this exception applies. Amending 2011 tax return   This exception does not apply if the organization sells the vehicle at auction. Amending 2011 tax return In that case, you cannot deduct the vehicle's fair market value. Amending 2011 tax return Example. Amending 2011 tax return Anita donates a used car to a qualified organization. Amending 2011 tax return She bought it 3 years ago for $9,000. Amending 2011 tax return A used car guide shows the fair market value for this type of car is $6,000. Amending 2011 tax return However, Anita gets a Form 1098-C from the organization showing the car was sold for $2,900. Amending 2011 tax return Neither exception 1 nor exception 2 applies. Amending 2011 tax return If Anita itemizes her deductions, she can deduct $2,900 for her donation. Amending 2011 tax return She must attach Form 1098-C and Form 8283 to her return. Amending 2011 tax return Deduction $500 or less. Amending 2011 tax return   If the qualified organization sells the vehicle for $500 or less and exceptions 1 and 2 do not apply, you can deduct the smaller of: $500, or The vehicle's fair market value on the date of the contribution. Amending 2011 tax return But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. Amending 2011 tax return   If the vehicle's fair market value is at least $250 but not more than $500, you must have a written statement from the qualified organization acknowledging your donation. Amending 2011 tax return The statement must contain the information and meet the tests for an acknowledgment described under Deductions of At Least $250 But Not More Than $500 under Records To Keep, later. Amending 2011 tax return Partial interest in property. Amending 2011 tax return   Generally, you cannot deduct a charitable contribution of less than your entire interest in property. Amending 2011 tax return Right to use property. Amending 2011 tax return   A contribution of the right to use property is a contribution of less than your entire interest in that property and is not deductible. Amending 2011 tax return For exceptions and more information, see Partial Interest in Property Not in Trust in Publication 561. Amending 2011 tax return Future interests in tangible personal property. Amending 2011 tax return   You cannot deduct the value of a charitable contribution of a future interest in tangible personal property until all intervening interests in and rights to the actual possession or enjoyment of the property have either expired or been turned over to someone other than yourself, a related person, or a related organization. Amending 2011 tax return Tangible personal property. Amending 2011 tax return   This is any property, other than land or buildings, that can be seen or touched. Amending 2011 tax return It includes furniture, books, jewelry, paintings, and cars. Amending 2011 tax return Future interest. Amending 2011 tax return   This is any interest that is to begin at some future time, regardless of whether it is designated as a future interest under state law. Amending 2011 tax return Determining Fair Market Value This section discusses general guidelines for determining the fair market value of various types of donated property. Amending 2011 tax return Publication 561 contains a more complete discussion. Amending 2011 tax return Fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts. Amending 2011 tax return Used clothing and household items. Amending 2011 tax return   The fair market value of used clothing and household goods is usually far less than what you paid for them when they were new. Amending 2011 tax return   For used clothing, you should claim as the value the price that buyers of used items actually pay in used clothing stores, such as consignment or thrift shops. Amending 2011 tax return See Household Goods in Publication 561 for information on the valuation of household goods, such as furniture, appliances, and linens. Amending 2011 tax return Example. Amending 2011 tax return Dawn Greene donated a coat to a thrift store operated by her church. Amending 2011 tax return She paid $300 for the coat 3 years ago. Amending 2011 tax return Similar coats in the thrift store sell for $50. Amending 2011 tax return The fair market value of the coat is $50. Amending 2011 tax return Dawn's donation is limited to $50. Amending 2011 tax return Cars, boats, and airplanes. Amending 2011 tax return   If you contribute a car, boat, or airplane to a charitable organization, you must determine its fair market value. Amending 2011 tax return Certain commercial firms and trade organizations publish used car pricing guides, commonly called “blue books,” containing complete dealer sale prices or dealer average prices for recent model years. Amending 2011 tax return The guides may be published monthly or seasonally and for different regions of the country. Amending 2011 tax return These guides also provide estimates for adjusting for unusual equipment, unusual mileage, and physical condition. Amending 2011 tax return The prices are not “official” and these publications are not considered an appraisal of any specific donated property. Amending 2011 tax return But they do provide clues for making an appraisal and suggest relative prices for comparison with current sales and offerings in your area. Amending 2011 tax return   You can also find used car pricing information on the Internet. Amending 2011 tax return Example. Amending 2011 tax return You donate a used car in poor condition to a local high school for use by students studying car repair. Amending 2011 tax return A used car guide shows the dealer retail value for this type of car in poor condition is $1,600. Amending 2011 tax return However, the guide shows the price for a private party sale of the car is only $750. Amending 2011 tax return The fair market value of the car is considered to be $750. Amending 2011 tax return Large quantities. Amending 2011 tax return   If you contribute a large number of the same item, fair market value is the price at which comparable numbers of the item are being sold. Amending 2011 tax return Giving Property That Has Decreased in Value If you contribute property with a fair market value that is less than your basis in it, your deduction is limited to its fair market value. Amending 2011 tax return You cannot claim a deduction for the difference between the property's basis and its fair market value. Amending 2011 tax return Giving Property That Has Increased in Value If you contribute property with a fair market value that is more than your basis in it, you may have to reduce the fair market value by the amount of appreciation (increase in value) when you figure your deduction. Amending 2011 tax return Your basis in property is generally what you paid for it. Amending 2011 tax return See chapter 13 if you need more information about basis. Amending 2011 tax return Different rules apply to figuring your deduction, depending on whether the property is: Ordinary income property, or Capital gain property. Amending 2011 tax return Ordinary income property. Amending 2011 tax return   Property is ordinary income property if you would have recognized ordinary income or short-term capital gain had you sold it at fair market value on the date it was contributed. Amending 2011 tax return Examples of ordinary income property are inventory, works of art created by the donor, manuscripts prepared by the donor, and capital assets (defined in chapter 14) held 1 year or less. Amending 2011 tax return Amount of deduction. Amending 2011 tax return   The amount you can deduct for a contribution of ordinary income property is its fair market value minus the amount that would be ordinary income or short-term capital gain if you sold the property for its fair market value. Amending 2011 tax return Generally, this rule limits the deduction to your basis in the property. Amending 2011 tax return Example. Amending 2011 tax return You donate stock you held for 5 months to your church. Amending 2011 tax return The fair market value of the stock on the day you donate it is $1,000, but you paid only $800 (your basis). Amending 2011 tax return Because the $200 of appreciation would be short-term capital gain if you sold the stock, your deduction is limited to $800 (fair market value minus the appreciation). Amending 2011 tax return Capital gain property. Amending 2011 tax return   Property is capital gain property if you would have recognized long-term capital gain had you sold it at fair market value on the date of the contribution. Amending 2011 tax return It includes capital assets held more than 1 year, as well as certain real property and depreciable property used in your trade or business and, generally, held more than 1 year. Amending 2011 tax return Amount of deduction — general rule. Amending 2011 tax return   When figuring your deduction for a contribution of capital gain property, you generally can use the fair market value of the property. Amending 2011 tax return Exceptions. Amending 2011 tax return   In certain situations, you must reduce the fair market value by any amount that would have been long-term capital gain if you had sold the property for its fair market value. Amending 2011 tax return Generally, this means reducing the fair market value to the property's cost or other basis. Amending 2011 tax return Bargain sales. Amending 2011 tax return   A bargain sale of property is a sale or exchange for less than the property's fair market value. Amending 2011 tax return A bargain sale to a qualified organization is partly a charitable contribution and partly a sale or exchange. Amending 2011 tax return A bargain sale may result in a taxable gain. Amending 2011 tax return More information. Amending 2011 tax return   For more information on donating appreciated property, see Giving Property That Has Increased in Value in Publication 526. Amending 2011 tax return When To Deduct You can deduct your contributions only in the year you actually make them in cash or other property (or in a later carryover year, as explained later under Carryovers ). Amending 2011 tax return This applies whether you use the cash or an accrual method of accounting. Amending 2011 tax return Time of making contribution. Amending 2011 tax return   Usually, you make a contribution at the time of its unconditional delivery. Amending 2011 tax return Checks. Amending 2011 tax return   A check you mail to a charity is considered delivered on the date you mail it. Amending 2011 tax return Text message. Amending 2011 tax return   Contributions made by text message are deductible in the year you send the text message if the contribution is charged to your telephone or wireless account. Amending 2011 tax return Credit card. Amending 2011 tax return    Contributions charged on your credit card are deductible in the year you make the charge. Amending 2011 tax return Pay-by-phone account. Amending 2011 tax return    Contributions made through a pay-by-phone account are considered delivered on the date the financial institution pays the amount. Amending 2011 tax return Stock certificate. Amending 2011 tax return   A properly endorsed stock certificate is considered delivered on the date of mailing or other delivery to the charity or to the charity's agent. Amending 2011 tax return However, if you give a stock certificate to your agent or to the issuing corporation for transfer to the name of the charity, your contribution is not delivered until the date the stock is transferred on the books of the corporation. Amending 2011 tax return Promissory note. Amending 2011 tax return   If you issue and deliver a promissory note to a charity as a contribution, it is not a contribution until you make the note payments. Amending 2011 tax return Option. Amending 2011 tax return    If you grant a charity an option to buy real property at a bargain price, it is not a contribution until the organization exercises the option. Amending 2011 tax return Borrowed funds. Amending 2011 tax return   If you contribute borrowed funds, you can deduct the contribution in the year you deliver the funds to the charity, regardless of when you repay the loan. Amending 2011 tax return Limits on Deductions The amount you can deduct for charitable contributions cannot be more than 50% of your adjusted gross income (AGI). Amending 2011 tax return Your deduction may be further limited to 30% or 20% of your AGI, depending on the type of property you give and the type of organization you give it to. Amending 2011 tax return If your total contributions for the year are 20% or less of your AGI, these limits do not apply to you. Amending 2011 tax return The limits are discussed in detail under Limits on Deductions in Publication 526. Amending 2011 tax return A higher limit applies to certain qualified conservation contributions. Amending 2011 tax return See Publication 526 for details. Amending 2011 tax return Carryovers You can carry over any contributions you cannot deduct in the current year because they exceed your adjusted-gross-income limits. Amending 2011 tax return You can deduct the excess in each of the next 5 years until it is used up, but not beyond that time. Amending 2011 tax return For more information, see Carryovers in Publication 526. Amending 2011 tax return Records To Keep You must keep records to prove the amount of the contributions you make during the year. Amending 2011 tax return The kind of records you must keep depends on the amount of your contributions and whether they are: Cash contributions, Noncash contributions, or Out-of-pocket expenses when donating your services. Amending 2011 tax return Note. Amending 2011 tax return An organization generally must give you a written statement if it receives a payment from you that is more than $75 and is partly a contribution and partly for goods or services. Amending 2011 tax return (See Contributions From Which You Benefit under Contributions You Can Deduct, earlier. Amending 2011 tax return ) Keep the statement for your records. Amending 2011 tax return It may satisfy all or part of the recordkeeping requirements explained in the following discussions. Amending 2011 tax return Cash Contributions Cash contributions include those paid by cash, check, electronic funds transfer, debit card, credit card, or payroll deduction. Amending 2011 tax return You cannot deduct a cash contribution, regardless of the amount, unless you keep one of the following. Amending 2011 tax return A bank record that shows the name of the qualified organization, the date of the contribution, and the amount of the contribution. Amending 2011 tax return Bank records may include: A canceled check, A bank or credit union statement, or A credit card statement. Amending 2011 tax return A receipt (or a letter or other written communication) from the qualified organization showing the name of the organization, the date of the contribution, and the amount of the contribution. Amending 2011 tax return The payroll deduction records described next. Amending 2011 tax return Payroll deductions. Amending 2011 tax return   If you make a contribution by payroll deduction, you must keep: A pay stub, Form W-2, or other document furnished by your employer that shows the date and amount of the contribution, and A pledge card or other document prepared by or for the qualified organization that shows the name of the organization. Amending 2011 tax return If your employer withheld $250 or more from a single paycheck, see Contributions of $250 or More , next. Amending 2011 tax return Contributions of $250 or More You can claim a deduction for a contribution of $250 or more only if you have an acknowledgment of your contribution from the qualified organization or certain payroll deduction records. Amending 2011 tax return If you made more than one contribution of $250 or more, you must have either a separate acknowledgment for each or one acknowledgment that lists each contribution and the date of each contribution and shows your total contributions. Amending 2011 tax return Amount of contribution. Amending 2011 tax return   In figuring whether your contribution is $250 or more, do not combine separate contributions. Amending 2011 tax return For example, if you gave your church $25 each week, your weekly payments do not have to be combined. Amending 2011 tax return Each payment is a separate contribution. Amending 2011 tax return   If contributions are made by payroll deduction, the deduction from each paycheck is treated as a separate contribution. Amending 2011 tax return   If you made a payment that is partly for goods and services, as described earlier under Contributions From Which You Benefit , your contribution is the amount of the payment that is more than the value of the goods and services. Amending 2011 tax return Acknowledgment. Amending 2011 tax return   The acknowledgment must meet these tests. Amending 2011 tax return It must be written. Amending 2011 tax return It must include: The amount of cash you contributed, Whether the qualified organization gave you any goods or services as a result of your contribution (other than certain token items and membership benefits), A description and good faith estimate of the value of any goods or services described in (b) (other than intangible religious benefits), and A statement that the only benefit you received was an intangible religious benefit, if that was the case. Amending 2011 tax return The acknowledgment does not need to describe or estimate the value of an intangible religious benefit. Amending 2011 tax return An intangible religious benefit is a benefit that generally is not sold in commercial transactions outside a donative (gift) context. Amending 2011 tax return An example is admission to a religious ceremony. Amending 2011 tax return You must get it on or before the earlier of: The date you file your return for the year you make the contribution, or The due date, including extensions, for filing the return. Amending 2011 tax return   If the acknowledgment does not show the date of the contribution, you must also have a bank record or receipt, as described earlier, that does show the date of the contribution. Amending 2011 tax return If the acknowledgment shows the date of the contribution and meets the other tests just described, you do not need any other records. Amending 2011 tax return Payroll deductions. Amending 2011 tax return   If you make a contribution by payroll deduction and your employer withholds $250 or more from a single paycheck, you must keep: A pay stub, Form W-2, or other document furnished by your employer that shows the amount withheld as a contribution, and A pledge card or other document prepared by or for the qualified organization that shows the name of the organization and states the organization does not provide goods or services in return for any contribution made to it by payroll deduction. Amending 2011 tax return A single pledge card may be kept for all contributions made by payroll deduction regardless of amount as long as it contains all the required information. Amending 2011 tax return   If the pay stub, Form W-2, pledge card, or other document does not show the date of the contribution, you must have another document that does show the date of the contribution. Amending 2011 tax return If the pay stub, Form W-2, pledge card, or other document shows the date of the contribution, you do not need any other records except those just described in (1) and (2). Amending 2011 tax return Noncash Contributions For a contribution not made in cash, the records you must keep depend on whether your deduction for the contribution is: Less than $250, At least $250 but not more than $500, Over $500 but not more than $5,000, or Over $5,000. Amending 2011 tax return Amount of deduction. Amending 2011 tax return   In figuring whether your deduction is $500 or more, combine your claimed deductions for all similar items of property donated to any charitable organization during the year. Amending 2011 tax return   If you received goods or services in return, as described earlier in Contributions From Which You Benefit , reduce your contribution by the value of those goods or services. Amending 2011 tax return If you figure your deduction by reducing the fair market value of the donated property by its appreciation, as described earlier in Giving Property That Has Increased in Value , your contribution is the reduced amount. Amending 2011 tax return Deductions of Less Than $250 If you make any noncash contribution, you must get and keep a receipt from the charitable organization showing: The name of the charitable organization, The date and location of the charitable contribution, and A reasonably detailed description of the property. Amending 2011 tax return A letter or other written communication from the charitable organization acknowledging receipt of the contribution and containing the information in (1), (2), and (3) will serve as a receipt. Amending 2011 tax return You are not required to have a receipt where it is impractical to get one (for example, if you leave property at a charity's unattended drop site). Amending 2011 tax return Additional records. Amending 2011 tax return   You must also keep reliable written records for each item of contributed property. Amending 2011 tax return Your written records must include the following information. Amending 2011 tax return The name and address of the organization to which you contributed. Amending 2011 tax return The date and location of the contribution. Amending 2011 tax return A description of the property in detail reasonable under the circumstances. Amending 2011 tax return For a security, keep the name of the issuer, the type of security, and whether it is regularly traded on a stock exchange or in an over-the-counter market. Amending 2011 tax return The fair market value of the property at the time of the contribution and how you figured the fair market value. Amending 2011 tax return If it was determined by appraisal, keep a signed copy of the appraisal. Amending 2011 tax return The cost or other basis of the property, if you must reduce its fair market value by appreciation. Amending 2011 tax return Your records should also include the amount of the reduction and how you figured it. Amending 2011 tax return The amount you claim as a deduction for the tax year as a result of the contribution, if you contribute less than your entire interest in the property during the tax year. Amending 2011 tax return Your records must include the amount you claimed as a deduction in any earlier years for contributions of other interests in this property. Amending 2011 tax return They must also include the name and address of each organization to which you contributed the other interests, the place where any such tangible property is located or kept, and the name of any person in possession of the property, other than the organization to which you contributed it. Amending 2011 tax return The terms of any conditions attached to the contribution of property. Amending 2011 tax return Deductions of At Least $250 But Not More Than $500 If you claim a deduction of at least $250 but not more than $500 for a noncash charitable contribution, you must get and keep an acknowledgment of your contribution from the qualified organization. Amending 2011 tax return If you made more than one contribution of $250 or more, you must have either a separate acknowledgment for each or one acknowledgment that shows your total contributions. Amending 2011 tax return The acknowledgment must contain the information in items (1) through (3) under Deductions of Less Than $250 , earlier, and your written records must include the information listed in that discussion under Additional records . Amending 2011 tax return The acknowledgment must also meet these tests. Amending 2011 tax return It must be written. Amending 2011 tax return It must include: A description (but not necessarily the value) of any property you contributed, Whether the qualified organization gave you any goods or services as a result of your contribution (other than certain token items and membership benefits), and A description and good faith estimate of the value of any goods or services described in (b). Amending 2011 tax return If the only benefit you received was an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in a commercial transaction outside the donative context, the acknowledgment must say so and does not need to describe or estimate the value of the benefit. Amending 2011 tax return You must get it on or before the earlier of: The date you file your return for the year you make the contribution, or The due date, including extensions, for filing the return. Amending 2011 tax return Deductions Over $500 You are required to give additional information if you claim a deduction over $500 for noncash charitable contributions. Amending 2011 tax return See Records To Keep in Publication 526 for more information. Amending 2011 tax return Out-of-Pocket Expenses If you give services to a qualified organization and have unreimbursed out-of-pocket expenses related to those services, the following two rules apply. Amending 2011 tax return You must have adequate records to prove the amount of the expenses. Amending 2011 tax return If any of your unreimbursed out-of-pocket expenses, considered separately, are $250 or more (for example, you pay $250 or more for an airline ticket to attend a convention of a qualified organization as a chosen representative), you must get an acknowledgment from the qualified organization that contains: A description of the services you provided, A statement of whether or not the organization provided you any goods or services to reimburse you for the expenses you incurred, A description and a good faith estimate of the value of any goods or services (other than intangible religious benefits) provided to reimburse you, and A statement that the only benefit you received was an intangible religious benefit, if that was the case. Amending 2011 tax return The acknowledgment does not need to describe or estimate the value of an intangible religious benefit (defined earlier under Acknowledgment ). Amending 2011 tax return You must get the acknowledgment on or before the earlier of: The date you file your return for the year you make the contribution, or The due date, including extensions, for filing the return. Amending 2011 tax return Car expenses. Amending 2011 tax return   If you claim expenses directly related to use of your car in giving services to a qualified organization, you must keep reliable written records of your expenses. Amending 2011 tax return Whether your records are considered reliable depends on all the facts and circumstances. Amending 2011 tax return Generally, they may be considered reliable if you made them regularly and at or near the time you had the expenses. Amending 2011 tax return   For example, your records might show the name of the organization you were serving and the dates you used your car for a charitable purpose. Amending 2011 tax return If you use the standard mileage rate of 14 cents a mile, your records must show the miles you drove your car for the charitable purpose. Amending 2011 tax return If you deduct your actual expenses, your records must show the costs of operating the car that are directly related to a charitable purpose. Amending 2011 tax return   See Car expenses under Out-of-Pocket Expenses in Giving Services, earlier, for the expenses you can deduct. Amending 2011 tax return How To Report Report your charitable contributions on Schedule A (Form 1040). Amending 2011 tax return If your total deduction for all noncash contributions for the year is over $500, you must also file Form 8283. Amending 2011 tax return See How To Report in Publication 526 for more information. Amending 2011 tax return Prev  Up  Next   Home   More Online Publications
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The Amending 2011 Tax Return

Amending 2011 tax return 11. Amending 2011 tax return   Casualties, Thefts, and Condemnations Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Casualties and TheftsDeductible losses. Amending 2011 tax return Nondeductible losses. Amending 2011 tax return Family pet. Amending 2011 tax return Progressive deterioration. Amending 2011 tax return Decline in market value of stock. Amending 2011 tax return Mislaid or lost property. Amending 2011 tax return Farming Losses How To Figure a Loss Deduction Limits on Losses of Personal-Use Property When Loss Is Deductible Proof of Loss Figuring a Gain Other Involuntary ConversionsCondemnation Irrigation Project Livestock Losses Tree Seedlings Postponing GainException. Amending 2011 tax return Related persons. Amending 2011 tax return Replacement Property Replacement Period How To Postpone Gain Disaster Area LossesWho is eligible. Amending 2011 tax return Covered disaster area. Amending 2011 tax return Reporting Gains and Losses Introduction This chapter explains the tax treatment of casualties, thefts, and condemnations. Amending 2011 tax return A casualty occurs when property is damaged, destroyed, or lost due to a sudden, unexpected, or unusual event. Amending 2011 tax return A theft occurs when property is stolen. Amending 2011 tax return A condemnation occurs when private property is legally taken for public use without the owner's consent. Amending 2011 tax return A casualty, theft, or condemnation may result in a deductible loss or taxable gain on your federal income tax return. Amending 2011 tax return You may have a deductible loss or a taxable gain even if only a portion of your property was affected by a casualty, theft, or condemnation. Amending 2011 tax return An involuntary conversion occurs when you receive money or other property as reimbursement for a casualty, theft, condemnation, disposition of property under threat of condemnation, or certain other events discussed in this chapter. Amending 2011 tax return If an involuntary conversion results in a gain and you buy qualified replacement property within the specified replacement period, you can postpone reporting the gain on your income tax return. Amending 2011 tax return For more information, see Postponing Gain , later. Amending 2011 tax return Topics - This chapter discusses: Casualties and thefts How to figure a loss or gain Other involuntary conversions Postponing gain Disaster area losses Reporting gains and losses Drought involving property connected with a trade or business or a transaction entered into for profit Useful Items - You may want to see: Publication 523 Selling Your Home 525 Taxable and Nontaxable Income 536 Net Operating Losses (NOLs) for Individuals, Estates, and Trusts 544 Sales and Other Dispositions of Assets 547 Casualties, Disasters, and Thefts 584 Casualty, Disaster, and Theft Loss Workbook (Personal-Use Property) 584-B Business Casualty, Disaster, and Theft Loss Workbook Form (and Instructions) Sch A (Form 1040) Itemized Deductions Sch D (Form 1040) Capital Gains and Losses Sch F (Form 1040) Profit or Loss From Farming 4684 Casualties and Thefts 4797 Sales of Business Property See chapter 16 for information about getting publications and forms. Amending 2011 tax return Casualties and Thefts If your property is destroyed, damaged, or stolen, you may have a deductible loss. Amending 2011 tax return If the insurance or other reimbursement is more than the adjusted basis of the destroyed, damaged, or stolen property, you may have a taxable gain. Amending 2011 tax return Casualty. Amending 2011 tax return   A casualty is the damage, destruction, or loss of property resulting from an identifiable event that is sudden, unexpected, or unusual. Amending 2011 tax return A sudden event is one that is swift, not gradual or progressive. Amending 2011 tax return An unexpected event is one that is ordinarily unanticipated and unintended. Amending 2011 tax return An unusual event is one that is not a day-to-day occurrence and that is not typical of the activity in which you were engaged. Amending 2011 tax return Deductible losses. Amending 2011 tax return   Deductible casualty losses can result from a number of different causes, including the following. Amending 2011 tax return Airplane crashes. Amending 2011 tax return Car, truck, or farm equipment accidents not resulting from your willful act or willful negligence. Amending 2011 tax return Earthquakes. Amending 2011 tax return Fires (but see Nondeductible losses next for exceptions). Amending 2011 tax return Floods. Amending 2011 tax return Freezing. Amending 2011 tax return Government-ordered demolition or relocation of a home that is unsafe to use because of a disaster as discussed under Disaster Area Losses, in Publication 547. Amending 2011 tax return Lightning. Amending 2011 tax return Storms, including hurricanes and tornadoes. Amending 2011 tax return Terrorist attacks. Amending 2011 tax return Vandalism. Amending 2011 tax return Volcanic eruptions. Amending 2011 tax return Nondeductible losses. Amending 2011 tax return   A casualty loss is not deductible if the damage or destruction is caused by the following. Amending 2011 tax return Accidentally breaking articles such as glassware or china under normal conditions. Amending 2011 tax return A family pet (explained below). Amending 2011 tax return A fire if you willfully set it, or pay someone else to set it. Amending 2011 tax return A car, truck, or farm equipment accident if your willful negligence or willful act caused it. Amending 2011 tax return The same is true if the willful act or willful negligence of someone acting for you caused the accident. Amending 2011 tax return Progressive deterioration (explained below). Amending 2011 tax return Family pet. Amending 2011 tax return   Loss of property due to damage by a family pet is not deductible as a casualty loss unless the requirements discussed above under Casualty are met. Amending 2011 tax return Example. Amending 2011 tax return You keep your horse in your yard. Amending 2011 tax return The ornamental fruit trees in your yard were damaged when your horse stripped the bark from them. Amending 2011 tax return Some of the trees were completely girdled and died. Amending 2011 tax return Because the damage was not unexpected or unusual, the loss is not deductible. Amending 2011 tax return Progressive deterioration. Amending 2011 tax return   Loss of property due to progressive deterioration is not deductible as a casualty loss. Amending 2011 tax return This is because the damage results from a steadily operating cause or a normal process, rather than from a sudden event. Amending 2011 tax return Examples of damage due to progressive deterioration include damage from rust, corrosion, or termites. Amending 2011 tax return However, weather-related conditions or disease may cause another type of involuntary conversion. Amending 2011 tax return See Other Involuntary Conversions , later. Amending 2011 tax return Theft. Amending 2011 tax return   A theft is the taking and removing of money or property with the intent to deprive the owner of it. Amending 2011 tax return The taking of property must be illegal under the law of the state where it occurred and it must have been done with criminal intent. Amending 2011 tax return You do not need to show a conviction for theft. Amending 2011 tax return   Theft includes the taking of money or property by the following means: Blackmail, Burglary, Embezzlement, Extortion, Kidnapping for ransom, Larceny, Robbery, or Threats. Amending 2011 tax return The taking of money or property through fraud or misrepresentation is theft if it is illegal under state or local law. Amending 2011 tax return Decline in market value of stock. Amending 2011 tax return   You cannot deduct as a theft loss the decline in market value of stock acquired on the open market for investment if the decline is caused by disclosure of accounting fraud or other illegal misconduct by the officers or directors of the corporation that issued the stock. Amending 2011 tax return However, you can deduct as a capital loss the loss you sustain when you sell or exchange the stock or the stock becomes completely worthless. Amending 2011 tax return You report a capital loss on Schedule D (Form 1040). Amending 2011 tax return For more information about stock sales, worthless stock, and capital losses, see chapter 4 of Publication 550. Amending 2011 tax return Mislaid or lost property. Amending 2011 tax return   The simple disappearance of money or property is not a theft. Amending 2011 tax return However, an accidental loss or disappearance of property can qualify as a casualty if it results from an identifiable event that is sudden, unexpected, or unusual. Amending 2011 tax return Example. Amending 2011 tax return A car door is accidentally slammed on your hand, breaking the setting of your diamond ring. Amending 2011 tax return The diamond falls from the ring and is never found. Amending 2011 tax return The loss of the diamond is a casualty. Amending 2011 tax return Farming Losses You can deduct certain casualty or theft losses that occur in the business of farming. Amending 2011 tax return The following is a discussion of some losses you can deduct and some you cannot deduct. Amending 2011 tax return Livestock or produce bought for resale. Amending 2011 tax return   Casualty or theft losses of livestock or produce bought for resale are deductible if you report your income on the cash method. Amending 2011 tax return If you report your income on an accrual method, take casualty and theft losses on property bought for resale by omitting the item from the closing inventory for the year of the loss. Amending 2011 tax return You cannot take a separate deduction. Amending 2011 tax return Livestock, plants, produce, and crops raised for sale. Amending 2011 tax return   Losses of livestock, plants, produce, and crops raised for sale are generally not deductible if you report your income on the cash method. Amending 2011 tax return You have already deducted the cost of raising these items as farm expenses, so their basis is equal to zero. Amending 2011 tax return   For plants with a preproductive period of more than 2 years, you may have a deductible loss if you have a tax basis in the plants. Amending 2011 tax return You usually have a tax basis if you capitalized the expenses associated with these plants under the uniform capitalization rules. Amending 2011 tax return The uniform capitalization rules are discussed in chapter 6. Amending 2011 tax return   If you report your income on an accrual method, casualty or theft losses are deductible only if you included the items in your inventory at the beginning of your tax year. Amending 2011 tax return You get the deduction by omitting the item from your inventory at the close of your tax year. Amending 2011 tax return You cannot take a separate casualty or theft deduction. Amending 2011 tax return Income loss. Amending 2011 tax return   A loss of future income is not deductible. Amending 2011 tax return Example. Amending 2011 tax return A severe flood destroyed your crops. Amending 2011 tax return Because you are a cash method taxpayer and already deducted the cost of raising the crops as farm expenses, this loss is not deductible, as explained above under Livestock, plants, produce, and crops raised for sale . Amending 2011 tax return You estimate that the crop loss will reduce your farm income by $25,000. Amending 2011 tax return This loss of future income is also not deductible. Amending 2011 tax return Loss of timber. Amending 2011 tax return   If you sell timber downed as a result of a casualty, treat the proceeds from the sale as a reimbursement. Amending 2011 tax return If you use the proceeds to buy qualified replacement property, you can postpone reporting the gain. Amending 2011 tax return See Postponing Gain , later. Amending 2011 tax return Property used in farming. Amending 2011 tax return   Casualty and theft losses of property used in your farm business usually result in deductible losses. Amending 2011 tax return If a fire or storm destroyed your barn, or you lose by casualty or theft an animal you bought for draft, breeding, dairy, or sport, you may have a deductible loss. Amending 2011 tax return See How To Figure a Loss , later. Amending 2011 tax return Raised draft, breeding, dairy, or sporting animals. Amending 2011 tax return   Generally, losses of raised draft, breeding, dairy, or sporting animals do not result in deductible casualty or theft losses because you have no basis in the animals. Amending 2011 tax return However, you may have a basis in the animal and therefore may be able to claim a deduction if either of the following situations applies to you. Amending 2011 tax return You use inventories to determine your income and you included the animals in your inventory. Amending 2011 tax return You capitalized the expenses associated with the animals under the uniform capitalization rules and therefore have a tax basis in the animals subject to a casualty or theft. Amending 2011 tax return When you include livestock in inventory, its last inventory value is its basis. Amending 2011 tax return When you lose an inventoried animal held for draft, breeding, dairy, or sport by casualty or theft during the year, decrease ending inventory by the amount you included in inventory for the animal. Amending 2011 tax return You cannot take a separate deduction. Amending 2011 tax return How To Figure a Loss How you figure a deductible casualty or theft loss depends on whether the loss was to farm or personal-use property and whether the property was stolen or partly or completely destroyed. Amending 2011 tax return Farm property. Amending 2011 tax return   Farm property is the property you use in your farming business. Amending 2011 tax return If your farm property was completely destroyed or stolen, your loss is figured as follows:      Your adjusted basis in the property     MINUS     Any salvage value     MINUS     Any insurance or other reimbursement you  receive or expect to receive      You can use the schedules in Publication 584-B to list your stolen, damaged, or destroyed business property and to figure your loss. Amending 2011 tax return   If your farm property was partially damaged, use the steps shown under Personal-use property next to figure your casualty loss. Amending 2011 tax return However, the deduction limits, discussed later, do not apply to farm property. Amending 2011 tax return Personal-use property. Amending 2011 tax return   Personal-use property is property used by you or your family members for personal purposes and not used in your farm business or for income-producing purposes. Amending 2011 tax return The following items are examples of personal-use property: Your main home. Amending 2011 tax return Furniture and electronics used in your main home and not used in a home office or for business purposes. Amending 2011 tax return Clothing and jewelry. Amending 2011 tax return An automobile used for nonbusiness purposes. Amending 2011 tax return You figure the casualty or theft loss on this property by taking the following steps. Amending 2011 tax return Determine your adjusted basis in the property before the casualty or theft. Amending 2011 tax return Determine the decrease in fair market value of the property as a result of the casualty or theft. Amending 2011 tax return From the smaller of the amounts you determined in (1) and (2), subtract any insurance or other reimbursement you receive or expect to receive. Amending 2011 tax return You must apply the deduction limits, discussed later, to determine your deductible loss. Amending 2011 tax return    You can use Publication 584 to list your stolen or damaged personal-use property and figure your loss. Amending 2011 tax return It includes schedules to help you figure the loss on your home, its contents, and your motor vehicles. Amending 2011 tax return Adjusted basis. Amending 2011 tax return   Adjusted basis is your basis (usually cost) increased or decreased by various events, such as improvements and casualty losses. Amending 2011 tax return For more information about adjusted basis, see chapter 6. Amending 2011 tax return Decrease in fair market value (FMV). Amending 2011 tax return   The decrease in FMV is the difference between the property's value immediately before the casualty or theft and its value immediately afterward. Amending 2011 tax return FMV is defined in chapter 10 under Payments Received or Considered Received . Amending 2011 tax return Appraisal. Amending 2011 tax return   To figure the decrease in FMV because of a casualty or theft, you generally need a competent appraisal. Amending 2011 tax return But other measures, such as the cost of cleaning up or making repairs (discussed next) can be used to establish decreases in FMV. Amending 2011 tax return   An appraisal to determine the difference between the FMV of the property immediately before a casualty or theft and immediately afterward should be made by a competent appraiser. Amending 2011 tax return The appraiser must recognize the effects of any general market decline that may occur along with the casualty. Amending 2011 tax return This information is needed to limit any deduction to the actual loss resulting from damage to the property. Amending 2011 tax return Cost of cleaning up or making repairs. Amending 2011 tax return   The cost of cleaning up after a casualty is not part of a casualty loss. Amending 2011 tax return Neither is the cost of repairing damaged property after a casualty. Amending 2011 tax return But you can use the cost of cleaning up or making repairs after a casualty as a measure of the decrease in FMV if you meet all the following conditions. Amending 2011 tax return The repairs are actually made. Amending 2011 tax return The repairs are necessary to bring the property back to its condition before the casualty. Amending 2011 tax return The amount spent for repairs is not excessive. Amending 2011 tax return The repairs fix the damage only. Amending 2011 tax return The value of the property after the repairs is not, due to the repairs, more than the value of the property before the casualty. Amending 2011 tax return Related expenses. Amending 2011 tax return   The incidental expenses due to a casualty or theft, such as expenses for the treatment of personal injuries, temporary housing, or a rental car, are not part of your casualty or theft loss. Amending 2011 tax return However, they may be deductible as farm business expenses if the damaged or stolen property is farm property. Amending 2011 tax return Separate computations for more than one item of property. Amending 2011 tax return   Generally, if a single casualty or theft involves more than one item of property, you must figure your loss separately for each item of property. Amending 2011 tax return Then combine the losses to determine your total loss. Amending 2011 tax return    There is an exception to this rule for personal-use real property. Amending 2011 tax return See Exception for personal-use real property, later. Amending 2011 tax return Example. Amending 2011 tax return A fire on your farm damaged a tractor and the barn in which it was stored. Amending 2011 tax return The tractor had an adjusted basis of $3,300. Amending 2011 tax return Its FMV was $28,000 just before the fire and $10,000 immediately afterward. Amending 2011 tax return The barn had an adjusted basis of $28,000. Amending 2011 tax return Its FMV was $55,000 just before the fire and $25,000 immediately afterward. Amending 2011 tax return You received insurance reimbursements of $2,100 on the tractor and $26,000 on the barn. Amending 2011 tax return Figure your deductible casualty loss separately for the two items of property. Amending 2011 tax return     Tractor Barn 1) Adjusted basis $3,300 $28,000 2) FMV before fire $28,000 $55,000 3) FMV after fire 10,000 25,000 4) Decrease in FMV  (line 2 − line 3) $18,000 $30,000 5) Loss (lesser of line 1 or line 4) $3,300 $28,000 6) Minus: Insurance 2,100 26,000 7) Deductible casualty loss $1,200 $2,000 8) Total deductible casualty loss $3,200 Exception for personal-use real property. Amending 2011 tax return   In figuring a casualty loss on personal-use real property, the entire property (including any improvements, such as buildings, trees, and shrubs) is treated as one item. Amending 2011 tax return Figure the loss using the smaller of the following. Amending 2011 tax return The decrease in FMV of the entire property. Amending 2011 tax return The adjusted basis of the entire property. Amending 2011 tax return Example. Amending 2011 tax return You bought a farm in 1990 for $160,000. Amending 2011 tax return The adjusted basis of the residential part is now $128,000. Amending 2011 tax return In 2013, a windstorm blew down shade trees and three ornamental trees planted at a cost of $7,500 on the residential part. Amending 2011 tax return The adjusted basis of the residential part includes the $7,500. Amending 2011 tax return The fair market value (FMV) of the residential part immediately before the storm was $400,000, and $385,000 immediately after the storm. Amending 2011 tax return The trees were not covered by insurance. Amending 2011 tax return 1) Adjusted basis $128,000 2) FMV before the storm $400,000 3) FMV after the storm 385,000 4) Decrease in FMV (line 2 − line 3) $15,000 5) Loss before insurance (lesser of line 1 or line 4) $15,000 6) Minus: Insurance -0- 7) Amount of loss $15,000 Insurance and other reimbursements. Amending 2011 tax return   If you receive an insurance or other type of reimbursement, you must subtract the reimbursement when you figure your loss. Amending 2011 tax return You do not have a casualty or theft loss to the extent you are reimbursed. Amending 2011 tax return   If you expect to be reimbursed for part or all of your loss, you must subtract the expected reimbursement when you figure your loss. Amending 2011 tax return You must reduce your loss even if you do not receive payment until a later tax year. Amending 2011 tax return    Do not subtract from your loss any insurance payments you receive for living expenses if you lose the use of your main home or are denied access to it because of a casualty. Amending 2011 tax return You may have to include a portion of these payments in your income. Amending 2011 tax return See Insurance payments for living expenses in Publication 547 for details. Amending 2011 tax return Disaster relief. Amending 2011 tax return   Food, medical supplies, and other forms of assistance you receive do not reduce your casualty loss, unless they are replacements for lost or destroyed property. Amending 2011 tax return Excludable cash gifts you receive also do not reduce your casualty loss if there are no limits on how you can use the money. Amending 2011 tax return   Generally, disaster relief grants received under the Robert T. Amending 2011 tax return Stafford Disaster Relief and Emergency Assistance Act are not included in your income. Amending 2011 tax return See Federal disaster relief grants , later, under Disaster Area Losses . Amending 2011 tax return   Qualified disaster relief payments for expenses you incurred as a result of a federally declared disaster are not taxable income to you. Amending 2011 tax return See Qualified disaster relief payments , later, under Disaster Area Losses . Amending 2011 tax return Reimbursement received after deducting loss. Amending 2011 tax return   If you figure your casualty or theft loss using your expected reimbursement, you may have to adjust your tax return for the tax year in which you get your actual reimbursement. Amending 2011 tax return Actual reimbursement less than expected. Amending 2011 tax return   If you later receive less reimbursement than you expected, include that difference as a loss with your other losses (if any) on your return for the year in which you can reasonably expect no more reimbursement. Amending 2011 tax return Actual reimbursement more than expected. Amending 2011 tax return   If you later receive more reimbursement than you expected after you have claimed a deduction for the loss, you may have to include the extra reimbursement in your income for the year you receive it. Amending 2011 tax return However, if any part of your original deduction did not reduce your tax for the earlier year, do not include that part of the reimbursement in your income. Amending 2011 tax return Do not refigure your tax for the year you claimed the deduction. Amending 2011 tax return See Recoveries in Publication 525 to find out how much extra reimbursement to include in income. Amending 2011 tax return If the total of all the reimbursements you receive is more than your adjusted basis in the destroyed or stolen property, you will have a gain on the casualty or theft. Amending 2011 tax return See Figuring a Gain in Publication 547 for information on how to treat a gain from the reimbursement you receive because of a casualty or theft. Amending 2011 tax return Actual reimbursement same as expected. Amending 2011 tax return   If you receive exactly the reimbursement you expected to receive, you do not have to include any of the reimbursement in your income and you cannot deduct any additional loss. Amending 2011 tax return Lump-sum reimbursement. Amending 2011 tax return   If you have a casualty or theft loss of several assets at the same time without an allocation of reimbursement to specific assets, divide the lump-sum reimbursement among the assets according to the fair market value of each asset at the time of the loss. Amending 2011 tax return Figure the gain or loss separately for each asset that has a separate basis. Amending 2011 tax return Adjustments to basis. Amending 2011 tax return   If you have a casualty or theft loss, you must decrease your basis in the property by any insurance or other reimbursement you receive and by any deductible loss. Amending 2011 tax return The result is your adjusted basis in the property. Amending 2011 tax return Amounts you spend on repairs to restore your property to its pre-casualty condition increase your adjusted basis. Amending 2011 tax return See Adjusted Basis in chapter 6 for more information. Amending 2011 tax return Example. Amending 2011 tax return You built a new silo for $25,000. Amending 2011 tax return This is the basis in your silo because that is the total cost you incurred to build it. Amending 2011 tax return During the year, a tornado damaged your silo and your allowable casualty loss deduction was $1,000. Amending 2011 tax return In addition, your insurance company reimbursed you $4,000 for the damage and you spent $6,000 to restore the silo to its pre-casualty condition. Amending 2011 tax return Your adjusted basis in the silo after the casualty is $26,000 ($25,000 - $1,000 - $4,000 + $6,000). Amending 2011 tax return Deduction Limits on Losses of Personal-Use Property Casualty and theft losses of property held for personal use may be deductible if you itemize deductions on Schedule A (Form 1040). Amending 2011 tax return There are two limits on the deduction for casualty or theft loss of personal-use property. Amending 2011 tax return You figure these limits on Form 4684. Amending 2011 tax return $100 rule. Amending 2011 tax return   You must reduce each casualty or theft loss on personal-use property by $100. Amending 2011 tax return This rule applies after you have subtracted any reimbursement. Amending 2011 tax return 10% rule. Amending 2011 tax return   You must further reduce the total of all your casualty or theft losses on personal-use property by 10% of your adjusted gross income. Amending 2011 tax return Apply this rule after you reduce each loss by $100. Amending 2011 tax return Adjusted gross income is on line 38 of Form 1040. Amending 2011 tax return Example. Amending 2011 tax return In June, you discovered that your house had been burglarized. Amending 2011 tax return Your loss after insurance reimbursement was $2,000. Amending 2011 tax return Your adjusted gross income for the year you discovered the burglary is $57,000. Amending 2011 tax return Figure your theft loss deduction as follows: 1. Amending 2011 tax return Loss after insurance $2,000 2. Amending 2011 tax return Subtract $100 100 3. Amending 2011 tax return Loss after $100 rule $1,900 4. Amending 2011 tax return Subtract 10% (. Amending 2011 tax return 10) × $57,000 AGI $5,700 5. Amending 2011 tax return Theft loss deduction -0- You do not have a theft loss deduction because your loss ($1,900) is less than 10% of your adjusted gross income ($5,700). Amending 2011 tax return    If you have a casualty or theft gain in addition to a loss, you will have to make a special computation before you figure your 10% limit. Amending 2011 tax return See 10% Rule in Publication 547. Amending 2011 tax return When Loss Is Deductible Generally, you can deduct casualty losses that are not reimbursable only in the tax year in which they occur. Amending 2011 tax return You generally can deduct theft losses that are not reimbursable only in the year you discover your property was stolen. Amending 2011 tax return However, losses in federally declared disaster areas are subject to different rules. Amending 2011 tax return See Disaster Area Losses , later, for an exception. Amending 2011 tax return If you are not sure whether part of your casualty or theft loss will be reimbursed, do not deduct that part until the tax year when you become reasonably certain that it will not be reimbursed. Amending 2011 tax return Leased property. Amending 2011 tax return   If you lease property from someone else, you can deduct a loss on the property in the year your liability for the loss is fixed. Amending 2011 tax return This is true even if the loss occurred or the liability was paid in a different year. Amending 2011 tax return You are not entitled to a deduction until your liability under the lease can be determined with reasonable accuracy. Amending 2011 tax return Your liability can be determined when a claim for recovery is settled, adjudicated, or abandoned. Amending 2011 tax return Example. Amending 2011 tax return Robert leased a tractor from First Implement, Inc. Amending 2011 tax return , for use in his farm business. Amending 2011 tax return The tractor was destroyed by a tornado in June 2012. Amending 2011 tax return The loss was not insured. Amending 2011 tax return First Implement billed Robert for the fair market value of the tractor on the date of the loss. Amending 2011 tax return Robert disagreed with the bill and refused to pay it. Amending 2011 tax return First Implement later filed suit in court against Robert. Amending 2011 tax return In 2013, Robert and First Implement agreed to settle the suit for $20,000, and the court entered a judgment in favor of First Implement. Amending 2011 tax return Robert paid $20,000 in June 2013. Amending 2011 tax return He can claim the $20,000 as a loss on his 2013 tax return. Amending 2011 tax return Net operating loss (NOL). Amending 2011 tax return   If your deductions, including casualty or theft loss deductions, are more than your income for the year, you may have an NOL. Amending 2011 tax return An NOL can be carried back or carried forward and deducted from income in other years. Amending 2011 tax return See Publication 536 for more information on NOLs. Amending 2011 tax return Proof of Loss To deduct a casualty or theft loss, you must be able to prove that there was a casualty or theft. Amending 2011 tax return You must have records to support the amount you claim for the loss. Amending 2011 tax return Casualty loss proof. Amending 2011 tax return   For a casualty loss, your records should show all the following information. Amending 2011 tax return The type of casualty (car accident, fire, storm, etc. Amending 2011 tax return ) and when it occurred. Amending 2011 tax return That the loss was a direct result of the casualty. Amending 2011 tax return That you were the owner of the property or, if you leased the property from someone else, that you were contractually liable to the owner for the damage. Amending 2011 tax return Whether a claim for reimbursement exists for which there is a reasonable expectation of recovery. Amending 2011 tax return Theft loss proof. Amending 2011 tax return   For a theft loss, your records should show all the following information. Amending 2011 tax return When you discovered your property was missing. Amending 2011 tax return That your property was stolen. Amending 2011 tax return That you were the owner of the property. Amending 2011 tax return Whether a claim for reimbursement exists for which there is a reasonable expectation of recovery. Amending 2011 tax return Figuring a Gain A casualty or theft may result in a taxable gain. Amending 2011 tax return If you receive an insurance payment or other reimbursement that is more than your adjusted basis in the destroyed, damaged, or stolen property, you have a gain from the casualty or theft. Amending 2011 tax return You generally report your gain as income in the year you receive the reimbursement. Amending 2011 tax return However, depending on the type of property you receive, you may not have to report your gain. Amending 2011 tax return See Postponing Gain , later. Amending 2011 tax return Your gain is figured as follows: The amount you receive, minus Your adjusted basis in the property at the time of the casualty or theft. Amending 2011 tax return Even if the decrease in FMV of your property is smaller than the adjusted basis of your property, use your adjusted basis to figure the gain. Amending 2011 tax return Amount you receive. Amending 2011 tax return   The amount you receive includes any money plus the value of any property you receive, minus any expenses you have in obtaining reimbursement. Amending 2011 tax return It also includes any reimbursement used to pay off a mortgage or other lien on the damaged, destroyed, or stolen property. Amending 2011 tax return Example. Amending 2011 tax return A tornado severely damaged your barn. Amending 2011 tax return The adjusted basis of the barn was $25,000. Amending 2011 tax return Your insurance company reimbursed you $40,000 for the damaged barn. Amending 2011 tax return However, you had legal expenses of $2,000 to collect that insurance. Amending 2011 tax return Your insurance minus your expenses to collect the insurance is more than your adjusted basis in the barn, so you have a gain. Amending 2011 tax return 1) Insurance reimbursement $40,000 2) Legal expenses 2,000 3) Amount received  (line 1 − line 2) $38,000 4) Adjusted basis 25,000 5) Gain on casualty (line 3 − line 4) $13,000 Other Involuntary Conversions In addition to casualties and thefts, other events cause involuntary conversions of property. Amending 2011 tax return Some of these are discussed in the following paragraphs. Amending 2011 tax return Gain or loss from an involuntary conversion of your property is usually recognized for tax purposes. Amending 2011 tax return You report the gain or deduct the loss on your tax return for the year you realize it. Amending 2011 tax return However, depending on the type of property you receive, you may not have to report your gain on the involuntary conversion. Amending 2011 tax return See Postponing Gain , later. Amending 2011 tax return Condemnation Condemnation is the process by which private property is legally taken for public use without the owner's consent. Amending 2011 tax return The property may be taken by the federal government, a state government, a political subdivision, or a private organization that has the power to legally take property. Amending 2011 tax return The owner receives a condemnation award (money or property) in exchange for the property taken. Amending 2011 tax return A condemnation is a forced sale, the owner being the seller and the condemning authority being the buyer. Amending 2011 tax return Threat of condemnation. Amending 2011 tax return   Treat the sale of your property under threat of condemnation as a condemnation, provided you have reasonable grounds to believe that your property will be condemned. Amending 2011 tax return Main home condemned. Amending 2011 tax return   If you have a gain because your main home is condemned, you generally can exclude the gain from your income as if you had sold or exchanged your home. Amending 2011 tax return For information on this exclusion, see Publication 523. Amending 2011 tax return If your gain is more than the amount you can exclude, but you buy replacement property, you may be able to postpone reporting the excess gain. Amending 2011 tax return See Postponing Gain , later. Amending 2011 tax return (You cannot deduct a loss from the condemnation of your main home. Amending 2011 tax return ) More information. Amending 2011 tax return   For information on how to figure the gain or loss on condemned property, see chapter 1 in Publication 544. Amending 2011 tax return Also see Postponing Gain , later, to find out if you can postpone reporting the gain. Amending 2011 tax return Irrigation Project The sale or other disposition of property located within an irrigation project to conform to the acreage limits of federal reclamation laws is an involuntary conversion. Amending 2011 tax return Livestock Losses Diseased livestock. Amending 2011 tax return   If your livestock die from disease, or are destroyed, sold, or exchanged because of disease, even though the disease is not of epidemic proportions, treat these occurrences as involuntary conversions. Amending 2011 tax return If the livestock were raised or purchased for resale, follow the rules for livestock discussed earlier under Farming Losses . Amending 2011 tax return Otherwise, figure the gain or loss from these conversions using the rules discussed under Determining Gain or Loss in chapter 8. Amending 2011 tax return If you replace the livestock, you may be able to postpone reporting the gain. Amending 2011 tax return See Postponing Gain below. Amending 2011 tax return Reporting dispositions of diseased livestock. Amending 2011 tax return   If you choose to postpone reporting gain on the disposition of diseased livestock, you must attach a statement to your return explaining that the livestock were disposed of because of disease. Amending 2011 tax return You must also include other information on this statement. Amending 2011 tax return See How To Postpone Gain , later, under Postponing Gain . Amending 2011 tax return Weather-related sales of livestock. Amending 2011 tax return   If you sell or exchange livestock (other than poultry) held for draft, breeding, or dairy purposes solely because of drought, flood, or other weather-related conditions, treat the sale or exchange as an involuntary conversion. Amending 2011 tax return Only livestock sold in excess of the number you normally would sell under usual business practice, in the absence of weather-related conditions, are considered involuntary conversions. Amending 2011 tax return Figure the gain or loss using the rules discussed under Determining Gain or Loss in chapter 8. Amending 2011 tax return If you replace the livestock, you may be able to postpone reporting the gain. Amending 2011 tax return See Postponing Gain below. Amending 2011 tax return Example. Amending 2011 tax return It is your usual business practice to sell five of your dairy animals during the year. Amending 2011 tax return This year you sold 20 dairy animals because of drought. Amending 2011 tax return The sale of 15 animals is treated as an involuntary conversion. Amending 2011 tax return    If you do not replace the livestock, you may be able to report the gain in the following year's income. Amending 2011 tax return This rule also applies to other livestock (including poultry). Amending 2011 tax return See Sales Caused by Weather-Related Conditions in chapter 3. Amending 2011 tax return Tree Seedlings If, because of an abnormal drought, the failure of planted tree seedlings is greater than normally anticipated, you may have a deductible loss. Amending 2011 tax return Treat the loss as a loss from an involuntary conversion. Amending 2011 tax return The loss equals the previously capitalized reforestation costs you had to duplicate on replanting. Amending 2011 tax return You deduct the loss on the return for the year the seedlings died. Amending 2011 tax return Postponing Gain Do not report a gain if you receive reimbursement in the form of property similar or related in service or use to the destroyed, stolen, or other involuntarily converted property. Amending 2011 tax return Your basis in the new property is generally the same as your adjusted basis in the property it replaces. Amending 2011 tax return You must ordinarily report the gain on your stolen, destroyed, or other involuntarily converted property if you receive money or unlike property as reimbursement. Amending 2011 tax return However, you can choose to postpone reporting the gain if you purchase replacement property similar or related in service or use to your destroyed, stolen, or other involuntarily converted property within a specific replacement period. Amending 2011 tax return If you have a gain on damaged property, you can postpone reporting the gain if you spend the reimbursement to restore the property. Amending 2011 tax return To postpone reporting all the gain, the cost of your replacement property must be at least as much as the reimbursement you receive. Amending 2011 tax return If the cost of the replacement property is less than the reimbursement, you must include the gain in your income up to the amount of the unspent reimbursement. Amending 2011 tax return Example 1. Amending 2011 tax return In 1985, you constructed a barn to store farm equipment at a cost of $20,000. Amending 2011 tax return In 1987, you added a silo to the barn at a cost of $15,000 to store grain. Amending 2011 tax return In May of this year, the property was worth $100,000. Amending 2011 tax return In June the barn and silo were destroyed by a tornado. Amending 2011 tax return At the time of the tornado, you had an adjusted basis of $0 in the property. Amending 2011 tax return You received $85,000 from the insurance company. Amending 2011 tax return You had a gain of $85,000 ($85,000 – $0). Amending 2011 tax return You spent $80,000 to rebuild the barn and silo. Amending 2011 tax return Since this is less than the insurance proceeds received, you must include $5,000 ($85,000 – $80,000) in your income. Amending 2011 tax return Example 2. Amending 2011 tax return In 1970, you bought a cabin in the mountains for your personal use at a cost of $18,000. Amending 2011 tax return You made no further improvements or additions to it. Amending 2011 tax return When a storm destroyed the cabin this January, the cabin was worth $250,000. Amending 2011 tax return You received $146,000 from the insurance company in March. Amending 2011 tax return You had a gain of $128,000 ($146,000 − $18,000). Amending 2011 tax return You spent $144,000 to rebuild the cabin. Amending 2011 tax return Since this is less than the insurance proceeds received, you must include $2,000 ($146,000 − $144,000) in your income. Amending 2011 tax return Buying replacement property from a related person. Amending 2011 tax return   You cannot postpone reporting a gain from a casualty, theft, or other involuntary conversion if you buy the replacement property from a related person (discussed later). Amending 2011 tax return This rule applies to the following taxpayers. Amending 2011 tax return C corporations. Amending 2011 tax return Partnerships in which more than 50% of the capital or profits interest is owned by C corporations. Amending 2011 tax return Individuals, partnerships (other than those in (2) above), and S corporations if the total realized gain for the tax year on all involuntarily converted properties on which there are realized gains is more than $100,000. Amending 2011 tax return For involuntary conversions described in (3) above, gains cannot be offset by any losses when determining whether the total gain is more than $100,000. Amending 2011 tax return If the property is owned by a partnership, the $100,000 limit applies to the partnership and each partner. Amending 2011 tax return If the property is owned by an S corporation, the $100,000 limit applies to the S corporation and each shareholder. Amending 2011 tax return Exception. Amending 2011 tax return   This rule does not apply if the related person acquired the property from an unrelated person within the period of time allowed for replacing the involuntarily converted property. Amending 2011 tax return Related persons. Amending 2011 tax return   Under this rule, related persons include, for example, a parent and child, a brother and sister, a corporation and an individual who owns more than 50% of its outstanding stock, and two partnerships in which the same C corporations own more than 50% of the capital or profits interests. Amending 2011 tax return For more information on related persons, see Nondeductible Loss under Sales and Exchanges Between Related Persons in chapter 2 of Publication 544. Amending 2011 tax return Death of a taxpayer. Amending 2011 tax return   If a taxpayer dies after having a gain, but before buying replacement property, the gain must be reported for the year in which the decedent realized the gain. Amending 2011 tax return The executor of the estate or the person succeeding to the funds from the involuntary conversion cannot postpone reporting the gain by buying replacement property. Amending 2011 tax return Replacement Property You must buy replacement property for the specific purpose of replacing your property. Amending 2011 tax return Your replacement property must be similar or related in service or use to the property it replaces. Amending 2011 tax return You do not have to use the same funds you receive as reimbursement for your old property to acquire the replacement property. Amending 2011 tax return If you spend the money you receive for other purposes, and borrow money to buy replacement property, you can still choose to postpone reporting the gain if you meet the other requirements. Amending 2011 tax return Property you acquire by gift or inheritance does not qualify as replacement property. Amending 2011 tax return Owner-user. Amending 2011 tax return   If you are an owner-user, similar or related in service or use means that replacement property must function in the same way as the property it replaces. Amending 2011 tax return Examples of property that functions in the same way as the property it replaces are a home that replaces another home, a dairy cow that replaces another dairy cow, and farm land that replaces other farm land. Amending 2011 tax return A grinding mill that replaces a tractor does not qualify. Amending 2011 tax return Neither does a breeding or draft animal that replaces a dairy cow. Amending 2011 tax return Soil or other environmental contamination. Amending 2011 tax return   If, because of soil or other environmental contamination, it is not feasible for you to reinvest your insurance money or other proceeds from destroyed or damaged livestock in property similar or related in service or use to the livestock, you can treat other property (including real property) used for farming purposes, as property similar or related in service or use to the destroyed or damaged livestock. Amending 2011 tax return Weather-related conditions. Amending 2011 tax return   If, because of drought, flood, or other weather-related conditions, it is not feasible for you to reinvest the insurance money or other proceeds in property similar or related in service or use to the livestock, you can treat other property (excluding real property) used for farming purposes, as property similar or related in service or use to the livestock you disposed of. Amending 2011 tax return Example. Amending 2011 tax return Each year you normally sell 25 cows from your beef herd. Amending 2011 tax return However, this year you had to sell 50 cows. Amending 2011 tax return This is because a severe drought significantly reduced the amount of hay and pasture yield needed to feed your herd for the rest of the year. Amending 2011 tax return Because, as a result of the severe drought, it is not feasible for you to use the proceeds from selling the extra cows to buy new cows, you can treat other property (excluding real property) used for farming purposes, as property similar or related in service or use to the cows you sold. Amending 2011 tax return Standing crop destroyed by casualty. Amending 2011 tax return   If a storm or other casualty destroyed your standing crop and you use the insurance money to acquire either another standing crop or a harvested crop, this purchase qualifies as replacement property. Amending 2011 tax return The costs of planting and raising a new crop qualify as replacement costs for the destroyed crop only if you use the crop method of accounting (discussed in chapter 2). Amending 2011 tax return In that case, the costs of bringing the new crop to the same level of maturity as the destroyed crop qualify as replacement costs to the extent they are incurred during the replacement period. Amending 2011 tax return Timber loss. Amending 2011 tax return   Standing timber you bought with the proceeds from the sale of timber downed as a result of a casualty, such as high winds, earthquakes, or volcanic eruptions, qualifies as replacement property. Amending 2011 tax return If you bought the standing timber within the replacement period, you can postpone reporting the gain. Amending 2011 tax return Business or income-producing property located in a federally declared disaster area. Amending 2011 tax return   If your destroyed business or income-producing property was located in a federally declared disaster area, any tangible replacement property you acquire for use in any business is treated as similar or related in service or use to the destroyed property. Amending 2011 tax return For more information, see Disaster Area Losses in Publication 547. Amending 2011 tax return Substituting replacement property. Amending 2011 tax return   Once you have acquired qualified replacement property that you designate as replacement property in a statement attached to your tax return, you cannot substitute other qualified replacement property. Amending 2011 tax return This is true even if you acquire the other property within the replacement period. Amending 2011 tax return However, if you discover that the original replacement property was not qualified replacement property, you can, within the replacement period, substitute the new qualified replacement property. Amending 2011 tax return Basis of replacement property. Amending 2011 tax return   You must reduce the basis of your replacement property (its cost) by the amount of postponed gain. Amending 2011 tax return In this way, tax on the gain is postponed until you dispose of the replacement property. Amending 2011 tax return Replacement Period To postpone reporting your gain, you must buy replacement property within a specified period of time. Amending 2011 tax return This is the replacement period. Amending 2011 tax return The replacement period begins on the date your property was damaged, destroyed, stolen, sold, or exchanged. Amending 2011 tax return The replacement period generally ends 2 years after the close of the first tax year in which you realize any part of your gain from the involuntary conversion. Amending 2011 tax return Example. Amending 2011 tax return You are a calendar year taxpayer. Amending 2011 tax return While you were on vacation, farm equipment that cost $2,200 was stolen from your farm. Amending 2011 tax return You discovered the theft when you returned to your farm on November 11, 2012. Amending 2011 tax return Your insurance company investigated the theft and did not settle your claim until January 5, 2013, when they paid you $3,000. Amending 2011 tax return You first realized a gain from the reimbursement for the theft during 2013, so you have until December 31, 2015, to replace the property. Amending 2011 tax return Main home in disaster area. Amending 2011 tax return   For your main home (or its contents) located in a federally declared disaster area, the replacement period ends 4 years after the close of the first tax year in which you realize any part of your gain from the involuntary conversion. Amending 2011 tax return See Disaster Area Losses , later. Amending 2011 tax return Property in the Midwestern disaster areas. Amending 2011 tax return   For property located in the Midwestern disaster areas (defined in Table 4 in the 2008 Publication 547) that was destroyed, damaged, stolen, or condemned, the replacement period ends 5 years after the close of the first tax year in which any part of your gain is realized. Amending 2011 tax return This 5-year replacement period applies only if substantially all of the use of the replacement property is in the Midwestern disaster areas. Amending 2011 tax return Property in the Kansas disaster area. Amending 2011 tax return   For property located in the Kansas disaster area that was destroyed, damaged, stolen, or condemned after May 3, 2007, as a result of the Kansas storms and tornadoes, the replacement period ends 5 years after the close of the first tax year in which any part of your gain is realized. Amending 2011 tax return This 5-year replacement period applies only if substantially all of the use of the replacement property is in the Kansas disaster area. Amending 2011 tax return Property in the Hurricane Katrina disaster area. Amending 2011 tax return   For property located in the Hurricane Katrina disaster area that was destroyed, damaged, stolen, or condemned after August 24, 2005, as a result of Hurricane Katrina, the replacement period ends 5 years after the close of the first tax year in which any part of your gain is realized. Amending 2011 tax return This 5-year replacement period applies only if substantially all of the use of the replacement property is in the Hurricane Katrina disaster area. Amending 2011 tax return Weather-related sales of livestock in an area eligible for federal assistance. Amending 2011 tax return   For the sale or exchange of livestock due to drought, flood, or other weather-related conditions in an area eligible for federal assistance, the replacement period ends 4 years after the close of the first tax year in which you realize any part of your gain from the sale or exchange. Amending 2011 tax return The IRS may extend the replacement period on a regional basis if the weather-related conditions continue for longer than 3 years. Amending 2011 tax return   For information on extensions of the replacement period because of persistent drought, see Notice 2006-82, 2006-39 I. Amending 2011 tax return R. Amending 2011 tax return B. Amending 2011 tax return 529, available at  www. Amending 2011 tax return irs. Amending 2011 tax return gov/irb/2006-39_IRB/ar11. Amending 2011 tax return html. Amending 2011 tax return For a list of counties for which exceptional, extreme, or severe drought was reported during the 12 months ending August 31, 2013, see Notice 2013-62, available at IRS. Amending 2011 tax return gov. Amending 2011 tax return Condemnation. Amending 2011 tax return   The replacement period for a condemnation begins on the earlier of the following dates. Amending 2011 tax return The date on which you disposed of the condemned property. Amending 2011 tax return The date on which the threat of condemnation began. Amending 2011 tax return The replacement period generally ends 2 years after the close of the first tax year in which any part of the gain on the condemnation is realized. Amending 2011 tax return But see Main home in disaster area , Property in the Midwestern disaster areas , Property in the Kansas disaster area , and Property in the Hurricane Katrina disaster area , earlier, for exceptions. Amending 2011 tax return Business or investment real property. Amending 2011 tax return   If real property held for use in a trade or business or for investment (not including property held primarily for sale) is condemned, the replacement period ends 3 years after the close of the first tax year in which any part of the gain on the condemnation is realized. Amending 2011 tax return Extension. Amending 2011 tax return   You can apply for an extension of the replacement period. Amending 2011 tax return Send your written application to the Internal Revenue Service Center where you file your tax return. Amending 2011 tax return See your tax return instructions for the address. Amending 2011 tax return Include all the details about your need for an extension. Amending 2011 tax return Make your application before the end of the replacement period. Amending 2011 tax return However, you can file an application within a reasonable time after the replacement period ends if you can show a good reason for the delay. Amending 2011 tax return You will get an extension of the replacement period if you can show reasonable cause for not making the replacement within the regular period. Amending 2011 tax return How To Postpone Gain You postpone reporting your gain by reporting your choice on your tax return for the year you have the gain. Amending 2011 tax return You have the gain in the year you receive insurance proceeds or other reimbursements that result in a gain. Amending 2011 tax return Required statement. Amending 2011 tax return   You should attach a statement to your return for the year you have the gain. Amending 2011 tax return This statement should include all the following information. Amending 2011 tax return The date and details of the casualty, theft, or other involuntary conversion. Amending 2011 tax return The insurance or other reimbursement you received. Amending 2011 tax return How you figured the gain. Amending 2011 tax return Replacement property acquired before return filed. Amending 2011 tax return   If you acquire replacement property before you file your return for the year you have the gain, your statement should also include detailed information about all the following items. Amending 2011 tax return The replacement property. Amending 2011 tax return The postponed gain. Amending 2011 tax return The basis adjustment that reflects the postponed gain. Amending 2011 tax return Any gain you are reporting as income. Amending 2011 tax return Replacement property acquired after return filed. Amending 2011 tax return   If you intend to buy replacement property after you file your return for the year you realize gain, your statement should also say that you are choosing to replace the property within the required replacement period. Amending 2011 tax return   You should then attach another statement to your return for the year in which you buy the replacement property. Amending 2011 tax return This statement should contain detailed information on the replacement property. Amending 2011 tax return If you acquire part of your replacement property in one year and part in another year, you must attach a statement to each year's return. Amending 2011 tax return Include in the statement detailed information on the replacement property bought in that year. Amending 2011 tax return Reporting weather-related sales of livestock. Amending 2011 tax return   If you choose to postpone reporting the gain on weather-related sales or exchanges of livestock, show all the following information on a statement attached to your return for the tax year in which you first realize any of the gain. Amending 2011 tax return Evidence of the weather-related conditions that forced the sale or exchange of the livestock. Amending 2011 tax return The gain realized on the sale or exchange. Amending 2011 tax return The number and kind of livestock sold or exchanged. Amending 2011 tax return The number of livestock of each kind you would have sold or exchanged under your usual business practice. Amending 2011 tax return   Show all the following information and the preceding information on the return for the year in which you replace the livestock. Amending 2011 tax return The dates you bought the replacement property. Amending 2011 tax return The cost of the replacement property. Amending 2011 tax return Description of the replacement property (for example, the number and kind of the replacement livestock). Amending 2011 tax return Amended return. Amending 2011 tax return   You must file an amended return (Form 1040X) for the tax year of the gain in either of the following situations. Amending 2011 tax return You do not acquire replacement property within the replacement period, plus extensions. Amending 2011 tax return On this amended return, you must report the gain and pay any additional tax due. Amending 2011 tax return You acquire replacement property within the required replacement period, plus extensions, but at a cost less than the amount you receive from the casualty, theft, or other involuntary conversion. Amending 2011 tax return On this amended return, you must report the part of the gain that cannot be postponed and pay any additional tax due. Amending 2011 tax return Disaster Area Losses Special rules apply to federally declared disaster area losses. Amending 2011 tax return A federally declared disaster is a disaster that occurred in an area declared by the President to be eligible for federal assistance under the Robert T. Amending 2011 tax return Stafford Disaster Relief and Emergency Assistance Act. Amending 2011 tax return It includes a major disaster or emergency declaration under the act. Amending 2011 tax return A list of the areas warranting public or individual assistance (or both) under the Act is available at the Federal Emergency Management Agency (FEMA) web site at www. Amending 2011 tax return fema. Amending 2011 tax return gov. Amending 2011 tax return This part discusses the special rules for when to deduct a disaster area loss and what tax deadlines may be postponed. Amending 2011 tax return For other special rules, see Disaster Area Losses in Publication 547. Amending 2011 tax return When to deduct the loss. Amending 2011 tax return   You generally must deduct a casualty loss in the year it occurred. Amending 2011 tax return However, if you have a deductible loss from a disaster that occurred in an area warranting public or individual assistance (or both), you can choose to deduct that loss on your return or amended return for the tax year immediately preceding the tax year in which the disaster happened. Amending 2011 tax return If you make this choice, the loss is treated as having occurred in the preceding year. Amending 2011 tax return    Claiming a qualifying disaster loss on the previous year's return may result in a lower tax for that year, often producing or increasing a cash refund. Amending 2011 tax return   You must make the choice to take your casualty loss for the disaster in the preceding year by the later of the following dates. Amending 2011 tax return The due date (without extensions) for filing your tax return for the tax year in which the disaster actually occurred. Amending 2011 tax return The due date (with extensions) for the return for the preceding tax year. Amending 2011 tax return Federal disaster relief grants. Amending 2011 tax return   Do not include post-disaster relief grants received under the Robert T. Amending 2011 tax return Stafford Disaster Relief and Emergency Assistance Act in your income if the grant payments are made to help you meet necessary expenses or serious needs for medical, dental, housing, personal property, transportation, or funeral expenses. Amending 2011 tax return Do not deduct casualty losses or medical expenses to the extent they are specifically reimbursed by these disaster relief grants. Amending 2011 tax return If the casualty loss was specifically reimbursed by the grant and you received the grant after the year in which you deducted the casualty loss, see Reimbursement received after deducting loss , earlier. Amending 2011 tax return Unemployment assistance payments under the Act are taxable unemployment compensation. Amending 2011 tax return Qualified disaster relief payments. Amending 2011 tax return   Qualified disaster relief payments are not included in the income of individuals to the extent any expenses compensated by these payments are not otherwise compensated for by insurance or other reimbursement. Amending 2011 tax return These payments are not subject to income tax, self-employment tax, or employment taxes (social security, Medicare, and federal unemployment taxes). Amending 2011 tax return No withholding applies to these payments. Amending 2011 tax return   Qualified disaster relief payments include payments you receive (regardless of the source) for the following expenses. Amending 2011 tax return Reasonable and necessary personal, family, living, or funeral expenses incurred as a result of a federally declared disaster. Amending 2011 tax return Reasonable and necessary expenses incurred for the repair or rehabilitation of a personal residence due to a federally declared disaster. Amending 2011 tax return (A personal residence can be a rented residence or one you own. Amending 2011 tax return ) Reasonable and necessary expenses incurred for the repair or replacement of the contents of a personal residence due to a federally declared disaster. Amending 2011 tax return   Qualified disaster relief payments include amounts paid by a federal, state, or local government in connection with a federally declared disaster to individuals affected by the disaster. Amending 2011 tax return    Qualified disaster relief payments do not include: Payments for expenses otherwise paid for by insurance or other reimbursements, or Income replacement payments, such as payments of lost wages, lost business income, or unemployment compensation. Amending 2011 tax return Qualified disaster mitigation payments. Amending 2011 tax return   Qualified disaster mitigation payments made under the Robert T. Amending 2011 tax return Stafford Disaster Relief and Emergency Assistance Act or the National Flood Insurance Act (as in effect on April 15, 2005) are not included in income. Amending 2011 tax return These are payments you, as a property owner, receive to reduce the risk of future damage to your property. Amending 2011 tax return You cannot increase your basis in property, or take a deduction or credit, for expenditures made with respect to those payments. Amending 2011 tax return Sale of property under hazard mitigation program. Amending 2011 tax return   Generally, if you sell or otherwise transfer property, you must recognize any gain or loss for tax purposes unless the property is your main home. Amending 2011 tax return You report the gain or deduct the loss on your tax return for the year you realize it. Amending 2011 tax return (You cannot deduct a loss on personal-use property unless the loss resulted from a casualty, as discussed earlier. Amending 2011 tax return ) However, if you sell or otherwise transfer property to the Federal Government, a state or local government, or an Indian tribal government under a hazard mitigation program, you can choose to postpone reporting the gain if you buy qualifying replacement property within a certain period of time. Amending 2011 tax return See Postponing Gain , earlier, for the rules that apply. Amending 2011 tax return Other federal assistance programs. Amending 2011 tax return    For more information about other federal assistance programs, see Crop Insurance and Crop Disaster Payments and Feed Assistance and Payments in chapter 3 earlier. Amending 2011 tax return Postponed tax deadlines. Amending 2011 tax return   The IRS may postpone for up to 1 year certain tax deadlines of taxpayers who are affected by a federally declared disaster. Amending 2011 tax return The tax deadlines the IRS may postpone include those for filing income, excise, and employment tax returns, paying income, excise, and employment taxes, and making contributions to a traditional IRA or Roth IRA. Amending 2011 tax return   If any tax deadline is postponed, the IRS will publicize the postponement in your area and publish a news release, revenue ruling, revenue procedure, notice, announcement, or other guidance in the Internal Revenue Bulletin (IRB). Amending 2011 tax return Go to http://www. Amending 2011 tax return irs. Amending 2011 tax return gov/uac/Tax-Relief-in-Disaster-Situations to find out if a tax deadline has been postponed for your area. Amending 2011 tax return Who is eligible. Amending 2011 tax return   If the IRS postpones a tax deadline, the following taxpayers are eligible for the postponement. Amending 2011 tax return Any individual whose main home is located in a covered disaster area (defined next). Amending 2011 tax return Any business entity or sole proprietor whose principal place of business is located in a covered disaster area. Amending 2011 tax return Any individual who is a relief worker affiliated with a recognized government or philanthropic organization and who is assisting in a covered disaster area. Amending 2011 tax return Any individual, business entity, or sole proprietorship whose records are needed to meet a postponed tax deadline, provided those records are maintained in a covered disaster area. Amending 2011 tax return The main home or principal place of business does not have to be located in the covered disaster area. Amending 2011 tax return Any estate or trust that has tax records necessary to meet a postponed tax deadline, provided those records are maintained in a covered disaster area. Amending 2011 tax return The spouse on a joint return with a taxpayer who is eligible for postponements. Amending 2011 tax return Any individual, business entity, or sole proprietorship not located in a covered disaster area, but whose necessary records to meet a postponed tax deadline are located in the covered disaster area. Amending 2011 tax return Any individual visiting the covered disaster area who was killed or injured as a result of the disaster. Amending 2011 tax return Any other person determined by the IRS to be affected by a federally declared disaster. Amending 2011 tax return Covered disaster area. Amending 2011 tax return   This is an area of a federally declared disaster area in which the IRS has decided to postpone tax deadlines for up to 1 year. Amending 2011 tax return Abatement of interest and penalties. Amending 2011 tax return   The IRS may abate the interest and penalties on the underpaid income tax for the length of any postponement of tax deadlines. Amending 2011 tax return Reporting Gains and Losses You will have to file one or more of the following forms to report your gains or losses from involuntary conversions. Amending 2011 tax return Form 4684. Amending 2011 tax return   Use this form to report your gains and losses from casualties and thefts. Amending 2011 tax return Form 4797. Amending 2011 tax return   Use this form to report involuntary conversions (other than from casualty or theft) of property used in your trade or business and capital assets held in connection with a trade or business or a transaction entered into for profit. Amending 2011 tax return Also use this form if you have a gain from a casualty or theft on trade, business or income-producing property held for more than 1 year and you have to recapture some or all of your gain as ordinary income. Amending 2011 tax return Form 8949. Amending 2011 tax return   Use this form to report gain from an involuntary conversion (other than from casualty or theft) of personal-use property. Amending 2011 tax return Schedule A (Form 1040). Amending 2011 tax return   Use this form to deduct your losses from casualties and thefts of personal-use property and income-producing property, that you reported on Form 4684. Amending 2011 tax return Schedule D (Form 1040). Amending 2011 tax return   Use this form to carry over the following gains. Amending 2011 tax return Net gain shown on Form 4797 from an involuntary conversion of business property held for more than 1 year. Amending 2011 tax return Net gain shown on Form 4684 from the casualty or theft of personal-use property. Amending 2011 tax return    Also use this form to figure the overall gain or loss from transactions reported on Form 8949. Amending 2011 tax return Schedule F (Form 1040). Amending 2011 tax return   Use this form to deduct your losses from casualty or theft of livestock or produce bought for sale under Other expenses in Part II, line 32, if you use the cash method of accounting and have not otherwise deducted these losses. Amending 2011 tax return Prev  Up  Next   Home   More Online Publications