Welcome back! Ask questions, get answers, and join our large community of tax professionals.
cancel
Showing results for 
Search instead for 
Did you mean: 

Reporting land that has become worthless

RESIPSA123
Level 2

My client invested in land to develop or sell.  He is a property investor.  Bought in 2008.  Turns out there is no easement to get to the land, making it worthless.  No offers in the last 3 years since he lost his lawsuit to compel the granting of an easement.  He cant legally get to the land.   Assuming I want to report this as a total loss, what form would I use?  Is this 8949 reporting of vacant land or 4797 reporting a for profit business asset?  Thanks!

0 Cheers

This discussion has been locked. No new contributions can be made. You may start a new discussion here

3 Comments 3
Just-Lisa-Now-
Level 15
Level 15

As long as he still owns it, nothing has been realized.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
BobKamman
Level 15

There are always helicopters.

Surrounding owners may sell to someone who wants to make a deal. 

Why has he waited three years?  If he discovered when he lost the lawsuit that he had been defrauded, that might have been a good time to claim a casualty loss.  

qbteachmt
Level 15

"Surrounding owners may sell to someone who wants to make a deal."

🙂

Neighboring owners might buy it, or sell theirs to him so he has some contiguous parcel. Or, you can lease it for a cell tower or water tank or electrical substation = it has value. Or, you donate it to a public entity, such as State or County Park, and they can force an access right.

Land is only worthless if it no longer exists, such as slumped into the ocean.

*******************************
"Level Up" is a gaming function, not a real life function.