In 2018 I sold a property I had inherited in 2008. Based on the estimated value at the time I became the owner (death of bequeather) the sale resulted in a sizable capital loss. The proceeds of the sale were transferred into USD in 2019. In 2019 I also paid for an estimate of the value of the property at the time of bequest. Should I subtract this expense from the net proceeds of the sale?
Do I report it all in 2018?
When yhou inherited it, it most likely became your personal property. For example, if what you inherited was the house of the deceased, then it became your personal property. Losses on the sale of personal property are never deductible and don't even have to be reported on your tax return.
However, the transfer of more than $10K from a foreign bank does have to be reported to the treasury department, and that has absolutely nothing what-so-ever to do with taxes. If you did a wire transfer then you can rest assured the U.S. bank receiving the funds has reported it to the treasury department already.
It was my understanding that sales of real estate personal property that result in a loss are considered capital losses and treated like security capital gains/losses. In particular, a real estate long term capital loss can be used to offset other long term capital gains. If the net loss is in excess of $3000, it can be carried over to subsequent years.
Is the above incorrect?
If it is correct, my main question is how to report this loss so that it is properly carried over (e.g., in Schedule D).
Also, because the proceeds were transferred in 2019, should the loss be calculated with the USD amount received in 2019 and reported in 2018 (when the sale occurred)?
Finally, should the cost of the estimate of the property be included in the loss amount and reported in 2018 even if the estimate was paid in 2019?