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Sold land/bought back home - tax???

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smkdmk

Junior Member
My state is Virginia.

I owned 1/6 interest in a family home & land (since 1993/1995). We sold the majority of the land and I bought the other 5/6 shares of the remaining land and house from the other family members. This home/land is my "second" home.

Will I have to take the "capital gain" (from when my mother passed away in 1995 to the sale in 2005 - which is about $6,500.00) and pay taxes on that or can I offset this with the fact that I purchased the house/land with that sale (and additional cash) from my other family members?

There were 2 actual sales and deeds. I received a 1099-s on the sale of land, but I did not do anything about the purchase since it was between family members.

Thank you!
 


abezon

Senior Member
You can't defer taxable gians unless you set up a 1031 exchange before selling. You'll need to pay taxes on the gains & add the amount paid for the remaining property to your share of the inherited basis.
 

smkdmk

Junior Member
Thanks for the quick response!! I understand the capital gain part, but where/how do I "add the amount paid for the remaining property to your share of the inherited basis."

Will this help me with a reduction of taxes owed?
 

LdiJ

Senior Member
smkdmk said:
My state is Virginia.

I owned 1/6 interest in a family home & land (since 1993/1995). We sold the majority of the land and I bought the other 5/6 shares of the remaining land and house from the other family members. This home/land is my "second" home.

Will I have to take the "capital gain" (from when my mother passed away in 1995 to the sale in 2005 - which is about $6,500.00) and pay taxes on that or can I offset this with the fact that I purchased the house/land with that sale (and additional cash) from my other family members?

There were 2 actual sales and deeds. I received a 1099-s on the sale of land, but I did not do anything about the purchase since it was between family members.
This one is too complicated for an internet message board. You need to sit down with a professional with all of the paperwork in front of you.
 

anteater

Senior Member
smkdmk said:
Will this help me with a reduction of taxes owed?
Only if you eventually sell the land/home. Not immediately.

You and the other family members had some cost basis in the property from when you inherited it. Some of that cost basis would be subtracted from the net sales proceeds form the land that was sold to determine the capital gains.

Since it sounds as if the property was land and a house, and only the land was sold, figuring the basis for only the land that was sold might be a bit complicated and you might need the assistance of a professional to figure it out.

Your cost basis for the home and land that you now own would be 1/6 of the original cost basis attributable to the home and land you now own plus whatever you paid to the other family members for their shares.
 

anteater

Senior Member
LdiJ said:
This one is too complicated for an internet message board. You need to sit down with a professional with all of the paperwork in front of you.
Much more concise!

I couldn't figure out if my attempted reply even made any sense.
 

smkdmk

Junior Member
Thanks for all the help! At least now I feel that I am not overlooking a really easy answer!

It is so awesome to have a place where I can actually ask a question and feel like someone is decent enough to post some helpful advice!

Thanks again everyone!!!!!
 

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