In your case, your basis in the land is what you paid for the land and original house (including acquisition costs), plus any improvements to the land. That means if you improved the value of the land by tearing down the old home, you can add the cost of removing the original house to the basis of the land.
Click here to read more about this topic.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
