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Topic Title: Property sale/tax question Topic Summary: Created On: 08/11/2016 03:12 AM |
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08/11/2016 03:12 AM
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About 10 years ago the ex-wife and I purchased a piece of property for 103,000. We divorced last year and I got the property. It sold last month for 45,000. Obviously a huge loss. Question is-what can I expect at tax time. Will I owe taxes on the sale or will I be able to write off the loss? Thanks.
------------------------- If it’s legal will do it, if it’s not legal, we’ll figure out how to change the law-Joe Biden |
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08/11/2016 07:28 AM
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I would say yes, but I would talk to H&R Block (or similar) tax pro, since they know all the new laws and stuff that would help you.
Good luck! ------------------------- GOP: Gaslight Obstruct Project |
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08/11/2016 07:47 AM
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You should be able to take capital loss, based on its value in the divorce settlement, or the date of the divorce. Then, again, the IRS may say "bend over butter bumm, and we will call you Betty, , ".
Just sayin ------------------------- Dora Hates You Edited: 08/12/2016 at 05:44 AM by dingpatch |
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08/11/2016 01:35 PM
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Not sure; def talk to a tax pro.
May depend somewhat on how you classified the property -- was it ever a business property, supposed to be an income-generating property (planned a rental house on it), etc... You might also see if someone can figure out how much you may have overpaid in property taxes over that time frame. If the tax value was first based on the value at which you bought it, and didn't decrease substantially along with the RE market over those 10 years, the new buyer's tax basis is $45K. Since there wasn't a singular collapse in the market last year, your ad valorem property taxes should have gone down a little bit each year. There might be some way to recover a bit of that. |
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08/13/2016 11:25 AM
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It was just an empty wooded lot.
One accountant told me it's a loss and that you can write 3000 a year Until the loss is cleared. That's what my research online agrees with. Def going to get Another opinion before tax time gets here ------------------------- If it’s legal will do it, if it’s not legal, we’ll figure out how to change the law-Joe Biden |
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08/13/2016 03:35 PM
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TurboTax
------------------------- Dora Hates You |
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08/16/2016 07:44 AM
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You cannot write down a loss on personal propery. However, you can schedule D it if you say it was bought with the intention of holding as an investment. If it is just a buildable lot, the IRS may flag it and see it as you bought a lot with intention to build a home. That being said, you are still lmiited to 3000 per year UNLESS you have capital gains in which you can offset larger capital losses with. I dont remember how many years you can carry the loss but if you want to cash out some stock in your portfolio for a gain, you can offset it with the loss and decrease your taxable income. Any tax professional can show you how to do this. ------------------------- If you want to hit a home run, you have to swing the bat. |
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08/18/2016 07:13 AM
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The loss on a sale of a principal residence is not deductible. Since it was an unimproved lot, no worries there. Land is considered a capital asset by IRS regs, and any sale will generate capital gain/loss treatment. Max capital loss is $3,000 per year, and the loss may be offset against other capital gains recognized in the same tax year before the $3,000 limitation is imposed. Hope that helps.
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08/18/2016 10:23 AM
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Congrats on the divorce! |
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