condemnation sale

[Earl]

Power company cut trees on client's personal residence and reimbursed
client for the value of the trees. Reported on 1099-S. Any other
alternative except report as capital gain with no basis.

Could this be done like a condemnation where the proceeds are not
taxable but used to reduce the basis in remainder of property.

Not sure it this could be done since there is no basis in the trees that
have been with property for some 40 years.

[Earl]

Bump

Moving this up. Would like to get some thoughts from others on how
they would handle this. Please indicate if further information is needed
to be able to answer the question.