If the recognized losses resulting from involuntary conversions arising from casualty or theft exceed the recognized gains from such events (i.e.,a net loss from the casualty),all of the involuntary conversions are treated as ordinary gains and losses.

Question

Quizplus · Accepted Answer

This statement is true. If the recognized losses from involuntary conversions exceed the recognized gains, then the entire amount is treated as ordinary gains and losses for tax purposes.

If the Recognized Losses Resulting from Involuntary Conversions Arising from Casualty