Yes, this would be considered an investment property since they are inherited mineral rights and not part of your personal use property. Since this is investment property and it was abandoned, it is treated as a disposition of property so it would be eligible for gain and loss treatment.
"Loss from abandonment of business or investment property is deductible as a loss. A loss from an abandonment of business or investment property that is not treated as a sale or exchange is generally an ordinary loss. This rule also applies to leasehold improvements the lessor made for the lessee that were abandoned." Pub 544
If you did not receive any type of payment for the property, then the selling price would be $0. Also, the cost basis would typically be the Fair Market Value on the date of death since this is inherited property.
@Bottome (Edited 3/6/2025 @ 12:05PM PST)
You would enter the sale of the land by clicking the following:
- Federal
- Income
- Show More next to Investment Income
- Start next to Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)
- Select Other
- Continue through and select land for the type of investment
- Answer how you obtained it
- You will need to enter the selling price, dates and the cost basis
Note, your navigation sequence may be slightly different. You can also use the Jump to feature by entering investment sale in the search bar at the top of the screen.
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