Hal_Al
Level 15

Deductions & credits

Using an example:

You paid $100,000 for the property. In the year your bought it, the tax accessor valued it at $80,000, broken down as $60,000 for the building and $20,000 for the land. So, 25% (20/80 = 25%) of the purchase price was for the land.  0.25 x $100,000 = $25,000.  

1.4acres / 2.2 = 63.6%.  0.636 x $25,00 = $15,909 is your cost basis in the vacant lot sold.  The revised  basis in your home is $100,000 - 15,909 = $84,091.