topic Can I take a deduction for sale of property (residential lot never built on) at a loss? in Deductions & credits

Can I take a deduction for sale of property (residential lot never built on) at a loss?

med-tation1953 — Wed, 11 Nov 2020 21:51:33 GMT

Re: Can I take a deduction for sale of property (residential lot never built on) at a loss?

DoninGA — Wed, 11 Nov 2020 22:03:44 GMT

The sale of personal residential property, not used as an investment or in a business, for less than the purchase price is not reported on a tax return.

Re: Can I take a deduction for sale of property (residential lot never built on) at a loss?

Hal_Al — Thu, 12 Nov 2020 12:39:57 GMT

As the other answer indicates, you may not deduct a capital loss on the sale of personal use property such as a 2nd home or vacation home.

I'm of the opinion that most vacant land can be treated as investment property, even a residential lot that you purchased for the purpose of building a 2nd (or primary) home; as long as the property was not actually used for personal use (e.g. camp site, gardening, playground).

Re: Can I take a deduction for sale of property (residential lot never built on) at a loss?

AmeliesUncle — Sat, 14 Nov 2020 05:33:33 GMT

The Courts usually look at intent. If the vacant land was intended for personal use, the loss is non-deductible. If it was intended for investment or business purposes, the loss is deductible.