Are you filing a return for a business or as part of your personal income?
Closing business. How much can I deduct?
Not sure what you mean here... You can deduct reasonable costs associated with running your business. These would include costs for "closing" your business, like any associated paperwork you have to file with the state to close your business.
Spent almost $6000+ trying to recover the site
Whether the money you spent to try to recover your site produced results is irrelevant- you spent it in the course of doing business and should be deductible.
Value of the site? Can it be deducted?
Is your site listed as an actual asset on your previous returns? If so, then when you "disposed" of it in 2011, any remaining value would be deducted.
However, more likely, you've just been deducting the annual renewal fee each year, and the value is $0 (since you're already deducting the renewal fee).
You could try to argue that the site was worth $10,000 (just using an arbitrary number for this example) before April. But then you would be taxed on the increase in site value from $0 to $10,000, which would be offset by the loss of "disposing" your $10,000 asset for $0. In other words, a net difference of $0, a lot of extra documentation, and could be flagged for an audit- nothing to gain and a lot to lose.
By the way, if this was an actual business, you DID file the paperwork with your state to close down the business, right? If not, you've got 2 more years of tax returns to file (actually 3- you'll need to file next year for 2014 as well), plus you'd better file that paperwork ASAP!
[edited by: LifeinAsia at 9:01 pm (utc) on Aug 20, 2014]
