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I sold a residential lot of land in 2019. never built a home. What deductions can I make:(a). HOA monthly fees since purchase or only for 2019; (b) Property taxes for 2019 or since purchase;(c) and maintenance expenses, utility assessments for 2019 for

 
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3 Replies
JulieS
Expert Alumni

I sold a residential lot of land in 2019. never built a home. What deductions can I make:(a). HOA monthly fees since purchase or only for 2019; (b) Property taxes for 2019 or since purchase;(c) and maintenance expenses, utility assessments for 2019 for

Of the items you listed, only the property taxes paid in 2019 are a deduction. You can deduct that as an itemized deduction, along with the property taxes paid on your home. It will be part of itemized deductions, so it may not change your taxes.

 

Your total itemized deduction must be more than your standard deduction, or it will not reduce your taxes. 

 

Homeowners Association fees are not deductible, unless it is a rental activity. 

 

Any assessments that you paid while you owned the property increase your basis in the property. 

 

When you sell real estate, you report the sale and the difference between your basis and the selling price is a gain or loss.

 

The starting point for basis is the amount that you paid for the property. To that you can add closing costs, unless they were otherwise deducted; assessments that increase the value of the property; and the cost of selling the property.

 

Click here for more information about basis.

 

If you want to make a IRC Sec 266 election, you can add your property taxes to your basis, instead of deducting them. This is an annual election, so if you add the election to your 2019 tax return, you can add the 2019 property taxes to your basis. 

 

Learn more about this election.

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I sold a residential lot of land in 2019. never built a home. What deductions can I make:(a). HOA monthly fees since purchase or only for 2019; (b) Property taxes for 2019 or since purchase;(c) and maintenance expenses, utility assessments for 2019 for

 Firstly, thank you very much for your quick response. Could you please clarify the term assessments? Does it mean HOA fees which I and my wife (married couple filing jointly) paid monthly since we purchase the lot or only for 2019? Our joint married status over 65 is higher than itemized deductions. If any HOA fees, maintenance fee or property tax is allowed, where in the Turbo Tax premier, we can enter to add to escrow cost?

ColeenD3
Expert Alumni

I sold a residential lot of land in 2019. never built a home. What deductions can I make:(a). HOA monthly fees since purchase or only for 2019; (b) Property taxes for 2019 or since purchase;(c) and maintenance expenses, utility assessments for 2019 for

None but mortgage interest and property taxes (if you itemize)  are allowed on a personal use home. In order for you to deduct any of the other expenses, it must have been business use property, meaning you derived income from renting it to others.

 

You may also take sales expenses. Enter your sale in the Investment section.

 

Sales expenses include:

 - commissions

 - appraisal fees

 - broker's fees

 - legal fees

 - advertising fees

 - home inspection reports

 - title insurance

 - transfer taxes or fees

 - geological surveys

 - loan charges (points) or other fees paid on the buyer's behalf

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