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chemise44
New Member

I paid a sales tax on real estate commission on the sale of my home. How do I enter that amount on my tax return?

 
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3 Replies
bwa
Alumni
Alumni

I paid a sales tax on real estate commission on the sale of my home. How do I enter that amount on my tax return?

What state was that (most states don't charge a sales tax on real estate items.)
chemise44
New Member

I paid a sales tax on real estate commission on the sale of my home. How do I enter that amount on my tax return?

New Mexico
bwa
Alumni
Alumni

I paid a sales tax on real estate commission on the sale of my home. How do I enter that amount on my tax return?

Apparently New Mexico is joined only by Hawaii and South Dakota that are states that charge taxes on real estate commissions.

As it's not separately deductible, I would just add it to the cost of the property and account for it as part of the gain or loss when sold.

It's not separately deductible because it's not one of the items you can add to the IRS sales tax tables. The IRS sales tax tables can have certain additions. These are limited to:

  • a motor vehicle (including a car, motorcycle, motor home, recreational vehicle, sport utility vehicle, truck, van, and off-road vehicle
  • a leased motor vehicle.
  • an aircraft, boat, home (including mobile and prefabricated),
  • or home building materials, if the tax rate was the same as the general sales tax rate.

As a real estate commission is none of those it would be included in the IRS sales tax tables if you can use them (i.e., if your state sales taxes are higher than your state income taxes.)

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