topic Sale of personal to rental in 1986 in Investors & landlords

Sale of personal to rental in 1986

Patw430 — Mon, 03 Jun 2019 20:11:32 GMT

I bought a house in 1963, moved out in 1986 and it became a rental. I do not have any records back that far and I sold it in 2018. I have the deed of original sale for l5,000 and I sold it for 140,000,in 2018. The market value in 2018 is $260,000. I am unable to trace back that far land value, depreciation etc. I also put in a new septic system in 2013 for 21,160.00 and depreciated it for 3,501 thru 2017.

If the market value is 260,000 why was it sold for 140,000?

KrisD — Mon, 03 Jun 2019 20:11:34 GMT

If the market value is 260,000 why was it sold for 140,000?

I had terrible tenants that refused to move ( and finally...

Patw430 — Mon, 03 Jun 2019 20:11:36 GMT

I had terrible tenants that refused to move ( and finally left in middle of the night) and left the place a disaster. I wanted to get rid of it as we were getting old and it was too much responsibility for me. I sold it as is to "We buy houses."

The only thing you need to find out is the value of the l...

KrisD — Mon, 03 Jun 2019 20:11:37 GMT

The only thing you need to find out is the value of the land in 1986, since land is not depreciated. Use a tax bill, or assesment, or speak with a realtor (one that's been around a while) to give you an estimate of the land value in 1986.

The building would have been completely depreciated by now since renat have a 27.5 year life. How you depreciated it without a value is a mystery to me, but whatever you used, it's zero now.

Even if you did not take the depreciation expenses on the rental, the IRS has you re-pay the depreciation that was taken, or could have been taken.

So the remaining basis in the property is the original 1986 value of the land, and the remaining 17,659 for the septic. The rest is long-term capital gains.