Vacant Land Sale

6 replies
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Hello,

Curious the taxable ramifications when a client has held vacant land for twenty years, and finally sells it? Is this simply a long-term capital gain situation? And can all those years of property taxes be considered when calculating cost basis?

Thank you,

Dawn

ProSeries Professional

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IRonMaN

Level 15

Capital gains. For any of those 20 years were property taxes previously deducted?

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BobKamman

Level 15

The question isn't whether the taxes were deducted, but whether an election to capitalize them was filed for any of those years.

SensibleandHourlyAuthor

Level 6

Highly doubt taxes were capitalized. However, the couple are very detailed and likely could go back through twenty years of taxes to determine if property taxes had been itemized and/or claimed on their State taxes. Is there a way for the software to document that?

Happy Friday.

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