Gifted land, developed & sold to pay for nursing home .... help :)

[sjs415]

1. I was gifted land from my Grandmother to use for her care expenses. (No, she doesn't qualify as a dependent.)

2. Rather than sell the land as a whole, I paid contractors to develop it so that I could sell the lots. 

3. I received multiple 1099-S forms for those sales.  

4. I know I can deduct medical expenses paid for my Grandmother even though she is not a dependent but are there any exceptions to property being sold to pay for nursing home expenses? 

5. Do I report the 1099-S forms as capital gain minus her cost basis and complete a Schedule C to deduct the development costs?  Or do I add development costs to her cost basis to adjust the gain?  **The property was in my name for 11 months. (from gift date to development sale date) 

**Tax year 2014 

[Critter]

The gifted basis + cost of improvement = cost basis used on the Sch D for the sales.  There is no exception to paying the cap gains no matter what the reason for the sale.