Today TaxMama hears from Don in Texas who tells us, “My brother and I inherited a house in 2004 from my aunt. Neither of us have ever lived in the house, nor have we rented it out. We sold the house in 2007 for K less that the FMV upon the death of my aunt.
buy lipitor online medstaff.englewoodhealth.org/wp-content/languages/new/lipitor.html no prescription
Do we need to report the sale to on our tax returns?
https://www.cinewebradio.com/wp-content/languages/new/write-my-paper.html
Can we claim the loss?”
Dear Don,
How nice of you aunt to leave you her house! Since neither of you have never lived in it, for you, the house was never a personal residence. Essentially, in your hands, it became investment property.
You must certainly report the sale.
https://www.cinewebradio.com/wp-content/languages/new/pay-for-research-paper.html
Report the sale on Schedule D.
For purchase date, since you have the property for more than a year, use the date of death.
https://www.cinewebradio.com/wp-content/languages/new/domestic-violence-research-paper.html
And for purchase price, use the value at date of death. PLUS….
You paid property taxes, insurance and utilities on the house all these years. You protected your investment. Did you take deductions for the property taxes? If you didn’t, then add them to the value at date of death. If you did, skip that. But add in all the other costs you were never able to deduct – insurance, utilities, gardener, etc. Hopefully, you have receipts?
Don’t forget to add all the commissions and selling costs to the cost of the house. Those will all reduce your profits, too.
buy celexa online medstaff.englewoodhealth.org/wp-content/languages/new/celexa.html no prescription
Also, be sure you put a copy of the appraisal at date of death into your tax file and your brother’s, just in case you’re audited.
So your loss may be more than just the $10,000. Aren’t you glad you asked?
And remember, you can find answers to all kinds of questions about inherited property and other tax issues, free. Where? Where else? At TaxMama.com
[Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.]- Ask TaxMama :: Where taxes are fun and answers are free
- www.TaxQuips.com :: The number ONE free tax podcast online
File Download (0:00 min / 1 MB)
