I sold an inherited house in a foreign country that was unoccupied for 1 1/2 years between the parent's death and sale. I got an appraisal done to get the FMV on deceased's date of death. This came at around $150K (just to use round numbers as an example). I paid all utility bills and house taxes for the 1 1/2 year period. I spent money traveling to the foreign country and I sold the house for a selling price of $50K at a significant loss just to get rid of it. However, I only received $35K at sale, $15K worth of foreign income taxes in that country were deducted at source. I have entered the following so far in the Investment Income EasyStep:
I have the following questions:
- For proceeds, should I enter $50K (selling price) or $35K (actual amount received)? If I enter $50K, how do I claim credit for the $15K in foreign income taxes paid (if this is even possible in my situation)?
- Where can I find what sales expenses are deductible? I found IRS publications explaining deductible sales expenses for your own house and rental property but less clear to me what is deductible for inherited property. Any links appreciated. More specifically, which of the following are deductible: travel (tickets, lodging, boarding, local transportation), utilities for the 1 1/2 years, house taxes, appraisal to get FMV?
Thank you so much in advance for your help! I have received awesome answers here, I'm sure you'll help me get through this as well.
