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Jack is correct. Hand holding or advising a self prepared return without all the facts and how they calculated the loss could lead you to more headaches if things go wrong at a later date. You know who will get the blame!

Its not sec. 1231 property, it is sec. 1250 (depr property) reported on page 2 of the form 4797.

A couple of friends of mine are NICU nurses in Boston. They tell me there is an entire *industry* built around EBT (food stamp card) and child tax credit fraud -- and the state could not care less about it; nor do the feds care. For example, a pregnant woman from the Dominican Republic, say, comes here ~7 months. Stays 'til her baby is born in Boston, making the kid a US citizen (under a perversion of the 14th Amendment, which perversion needs to be overturned). She signs up for welfare, food stamps, all kinds of aid. The facilitator group (working in the DR and within the state) help her sign up for an "address" (a warehouse, an already-used address like the Atlanta one, one of those "street address" mail delivery/acceptance services, whatever) -- which is required. She goes back to the DR after she gets her EBT card. Money gets added every month, and she plus family live like rich folks in the DR off US & Mass taxpayer money. There are similar schemes to then file US taxes and get EITC and the like. It's obscene. It's illegal. The government does NOT care. And every nickel that goes to someone illegally is a *dime* not available to help actual US citizens who need assistance -- or to keep in their pockets for their own use.

Oh and BTW, Death Valley is in CA, not Arizona! And in the summer there, hot water does come out of both taps.

I did not prepare this person's return....they did it themselves and just called me to make sure that the loss they had was ordinary loss....they were thinking it was a capital loss and limited to $3,000 per year. I will mention to the client the depreciation re-capture...with the understanding that it will likely cause confusion and, ultimately, a review of her return by me....which is when I will find out if it truly is a loss after recapturing depreciation that was taken....or could have been taken.

Unfortunately, whoever was responsible for unilaterally changing tax law by setting that policy for the IRS will never be held accountable. I wonder what things would be like in this country if the laws already on the books were enforced as written. I don't believe it is possible to completely eliminate fraud, but we should not be encouraging it through policy and regulations.