my question

[user17714277326]

My mother passed away Jan 2025. There was a TODDA to me, Therefore, mom's house was transferred to me. I live in Florida. The house was her main residence and is in Ohio. Am I able to deduct: repairs, inspection cost, appraisal cost, trip expenses back/ forth, "loss" on sale ( appraisal vs sale price ), etc.

Please advise

[email address removed]

[DianeW777]

Yes, you can use expenses as part of your sales expense. If any of the repairs were capital improvements to the house see the information below. 

Be sure to report your inherited house sale using the steps below. 

Your cost basis is the fair market value on the date of death of the decedent, plus the capital improvements (not repairs but improvements that are capital in nature).  The expenses of sale will reduce any gain or increase any loss as well. This is entered as the sale of investment property and can be entered as follows.

Enter the inherited property sale in TurboTax using the steps provided.  

1. Open or continue your return: Choose the Search box and type 'sale of second home' then use the Jump to link to enter your inherited sale) or follow the menu. In TurboTax Online select 'See more' in the FAQ then click 'sold second home'.
2. Under Wages & Income scroll to Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)
3. Answer Yes on the Did you sell any stocks, mutual funds, bonds, or other investments in 2025? screen
   • If you land on the Your investment sales summary screen, select Add More Sales
4. On the OK, let's start with one investment type screen, select Other, then Continue
5. On the Tell us more about this sale screen, enter the name of the person or institution that brokered the sale
6. On the next screen, select  Other (choose this also for inherited homes) then select  I inherited it under  How did you receive this investment? (For TurboTax Desktop you can enter a description of 'Inherited Home' and long term holding period).

[user17714277326]

Diane

I was told by a CPA that I could NOT use the house sale as a deduction because it is considered a "personal asset".

So who is correct?

[DianeW777]

It depends. If you never lived in the house as your home, if it is not a second home you used, your inheritance is received as investment property.  An inherited house is considered investment property and you can deduct the loss on the inherited property, but only if there was no personal use after your mother passed away - it was simply held between inheritance and sale.

Inherited Property (IRS Pub 550): If you sell or dispose of inherited property that is a capital asset, the gain or loss is considered long term, regardless of how long you held the property. For more information on inherited property, see Pub. 559.

@user17714277326 

[user17714277326]

I never lived in the house.

It was not my 2nd house........only for Jan to May ! 

The house is "inherited" by her death and with the TODDA , transferred to me in my name.

There was no personal use after her death. It was in my name from Jan to May 2025.

I was only there to facilitate the estate sale, repairs, appraisal, open houses, travel expenses back/forth from Florida/Ohio, etc.

The definition of inherited is key.......as it was transferred to my name.

[ThomasM125]

The house may qualify as investment property as evidenced by your actions to immediately prepare it for sale after you inherited it, coupled by your not using it for personal purposes. If so, a loss sustained on it could be deducted.

The other problem you have is proving that is was sold for less than the fair market value you assigned to it when you took possession of it. The IRS could argue that it was worth what you sold it for, being that you sold it soon after the valuation date. Assuming you have a reasonable basis for the fair market value you assigned to it, the loss may be allowed by the IRS.