Capital Gains tax on sale of this type property?

[DGO1223]

What is the name of your state?What is the name of your state?What is the name of your state? GA

I have just sold a house that has been sitting empty, not rented. It has been tied up in a legal issue. I have quite a lot of money tied up in it as legal fees, money to pay others' interest in the property, upkeep, repairs, taxes, insurance , realtor's fees to sell it, closing costs to sell that I paid as agreement to sell it, etc.

This has been more of headache than it's worth, taking over 2 years to settle. It was a Petition to Partition that I originally posted on here about, over 2 years ago, and was very complicated.

Any idea what kind of tax issue I face as far as taxes? I know there are issues I haven't thought of, and other details I need to provide, but need a starting point. I will talk to the guy who does our yearly taxes, but it will be a couple of weeks before I can.

Thanks

 

[Snipes5]

Did you live in it and own it for two out of the five years prior to the sale? If not, how long did you live there and when and why did you move, and how far away?

We can start there.

Snipes

 

[DGO1223]

Did you live in it and own it for two out of the five years prior to the sale? If not, how long did you live there and when and why did you move, and how far away?

We can start there.

Snipes

I never lived in it. Stepdad gave it to myself and brother to do with as we liked after he and my mom died. This was done in 1998. When they both died, 3 years ago, we did some repairs and when we tried to sell it, 3 other part owners (who we never knew existed) came forward to claim a portion.

The house had sat empty during that time while we were in a legal tangle with it. We finally got a clear title to it several weeks ago, and sold it last week.

So no, never lived there at all or rented it out. I live in the next town 25 miles from there.

Thanks

 

[Snipes5]

The "basis" is the value on the date of death of the last owner. That would be your Stepdad.

You add costs of sale to that. Anything you had to fix up so you could sell it, and *possibly* the legal costs to partition it.

Multiply the basis X your percentage, that is your basis personally.

Then you multiply the selling price by your percentage, and that is your portion of the selling price.

Subtract the basis from the selling price, and that is the portion you pay taxes on.

Note that some of the selling costs may not be apportioned to all the sellers, depending on who paid them.

Your capital gains rate is almost certainly 15%.

You will want to have your taxes done by a professional for '05. They will need the above info to do them correctly.

Snipes

 

[DGO1223]

That seems close to what I am able to come up with from what I've read, although a bit complicated for my knowledge of real estate sales.

I will talk to my tax guy as soon as he's available and get more details.

Thanks