Tax return to include sale of second home

Forum|Forum|1 year ago
October 30, 2024
4 replies
32 views

We are retired and sold our second home in Arizona this year. We bought it 12 years ago and have a profit to declare. Our previous tax returns have been short form since we do not have enough deductions . This year with the long term capital gains on the sale of the house, will we have to itemize our deductions? What kind of deductions are allowed for the sale of the house?

xmasbaby0

Level 15

There has not been a "short form" since 2017. Everyone uses a Form 1040. You are not required to itemize. If you will have enough itemized deductions to exceed your standard deduction, then you can choose to enter itemized deductions.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

hfredAuthor

Level 2

Does the itemized deductions for the house sale which reduces the long term capital gains count toward the standard deductions of our overall tax return?

NateTheGrEAt

Level 6

Itemized deductions on Schedule A include things such as medical expenses, mortgage interest, property taxes and charitable contributions.

Deductions against the sales price of a house (for example, closing costs, commissions and the like) are not Schedule A itemized deductions. They are adjustments to the amount of taxable gain on the sale of the house.

Unless you have a larger amount of Schedule A itemized deductions than your standard deduction, you are better off taking the standard deduction. This does not prevent you from counting sales expenses when calculating the capital gain on the sale of your house.

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