Thanks for your detailed reply. To your questions:
1. In 2022, I paid $275,000 to buy out the widow's half after my brother (joint ownership) died in 2017. $510 was the appraised value but we paid more than half to the widow. Why? We eventually had to launch a partition lawsuit to force her to settle (she kept changing terms) and the judge set the buyout at $275,000.
2. $180,000 paid for major/necessary repairs: this was a 14-room 1842 farmhouse with a Pomeroy Foundation Historical Marker in front of it. Completely rebuilt the rotted wraparound porch, replaced the leaking roof, replaced rotting siding/painting, installed gutters to alleviate leakage onto siding, replaced deteriorated dangerous driveway. None of this was a typical improvement--they all needed to be done. The place was in horrible shape, my brother refused to pay for any maintenance and his widow also refused. After settling the estate with the widow, we had to make these repairs or we'd lose the infrastructure.
3. The farmhouse was not rented during the five years of trying to settle the estate with his widow b/c of the dangerous shape it was in, the widow refused to pay anything towards repairs, and we didn't know how long it would take to settle the estate so couldn't promise renters anything long term. Not relevant, but she also refused to contribute towards taxes, insurance, utilities, upkeep, etc.
4. So, given #4, we had no rental income from 2017 to the sale in 2024. Can we still claim the farmhouse as rental property as you direct us to do?
THANKS!!
