ESTATE SOLD HOME AT A LOSS

[CaPattie4]

My client sold her husband's home as admin of the estate. At the time of death, it was their personal residence. I am assuming the Estate inherited the property and sold the home a year later while still in probate.

The sale generated a loss and I am wanting to confirm that the beneficiaries can claim the losses on the K-1 they recieve, correct? I have heard that because they lived in it after it went into probate, there will not be any losses to claim. What is the correct scenario?

Thanks for any advice.

Pattie

[M-MTax]

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@CaPattie4 wrote:

What is the correct scenario?

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No loss on the sale can be claimed if the property was held for personal use postmortem.

[RobertB4444]

If your client was still using the home as her primary residence at the time of sale then no, there is no loss to claim.  If they had made a profit on the sale it would have been excluded so the loss is as well.

@CaPattie4 

[CaPattie4]

Thanks for your reply! 

Pattie