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business insurance proceeds

Jane918
Level 3

If a business receives insurance proceeds, that does not need to be claimed as income, but how do you handle the expenses of rebuilding? For example, a small building blew down in a storm. Insurance proceeds were received, and a new building was put up, which needs to be depreciated.  

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1 Comment 1
sjrcpa
Level 15

You reduce the basis of the new building by the amount of insurance proceeds received.


Ex-AllStar