You will enter your cost basis in the sales screen. Basis = purchase price + costs to purchase + capital improvements made while you owned it + cost of sale.
Thanks for your quick reply. The costs in 30 years includes the selling price ($20,000.00), loan interest, nearly $30,000. paid in school/county taxes, and also inflation. There was no improvement to this land, and my 2016 sale was basically break even. How do I get that reported to the IRS? Thanks.
Taxes should have been deducted every year as an itemized deduction ... you cannot also add it to the basis. Inflation means nothing in this situation. And the loan interest had to either be deducted as investment interest on the Sch A OR be capitalized each year in order for you to add it to basis ... so if you didn't notify the IRS each year that is what you are doing you cannot use it now.
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