asset and land sales price and expenses

[shanavt]

Hello,

I am filling out the Sales Information section on the rental property that I sold in 2021 and I want to make sure the values I am entering in the below boxes are correct.

Asset Sales Price

Asset Sales Expenses

Land Sales Price

Land Sales Expenses

I sold my condo for $360,000 and the selling expenses were $27,000 (no improvements).  The latest county tax assessment shows a Land Value of $76,000 and Improvement Value of $277,400 for a Total Value of $353,400.  This puts the Land Value at ~22%, therefore, below is how I filled out the boxes.  Can someone confirm this is correct?

Asset Sales Price: $282,581 (78% of $360,000)

Asset Sales Expenses: $21,194 (78% of $27,000)

Land Sales Price: $77,419 (22% of $360,000)

Land Sales Expenses: $5,806 (22% of $27,000)

The Land Value has significantly increased in the last 2 years - prior years it was ~15% - so I just want to make sure that using the current ta assessment for the year I sold the condo is the or a correct method of coming up with these numbers.

Any help is much appreciated!  Thanks!

[DianeW777]

Yes, that's a perfectly acceptable way to arrive at the selling price and selling expenses for the building and the land.  There are other ways such as using the original cost of each then dividing each by that total.  Either way is fine because it's a reasonable conclusion.  Keep a copy of the county tax assessment in your tax records for future use.

[shanavt]

Thank you DianeW777! And just to confirm I should prorate the expenses using the same rate I use to split the sale price between Asset and Land, in this case 22%?  Correct?

[ColeenD3]

Yes, you would assign the same proration of the sales expenses to the land and building.