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dick_gilbert
Level 1

How can you account for the cost of a lot when you sell a house you built? Cost basis does not include cost of the land. IRS form 6252 establishes your profit by taking

the sales price which includes land and subtracting the cost of building the house without land.  This inflates the actual profit by the value of the land.  How should this be reported?
1 Reply
MinhT
Expert Alumni

How can you account for the cost of a lot when you sell a house you built? Cost basis does not include cost of the land. IRS form 6252 establishes your profit by taking

You should add the cost of the land to the cost basis of the building to report as total cost basis.

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