Sold land that was part of main residence for over 40 years. Made $35000 on the sale. It was not purchased as investment property. How do we list this?

[deanebrothers]

Divided 1.5 acre lot that main residence sits on in order to downsize due to age.  Sold 3/4 acre for $35000.  Was not purchased as investment, lived on it 45 years. Do we have to list it as investment now and pay capital gains?

[JulieR · Accepted solution]

Yes, even though this was "personal use" property you will enter it in TurboTax as an investment sale located within the Wages & Income section of the return. You will select start next to the line that says Stocks, Mutual Funds, Bonds, Other.  You will then follow the prompts to enter your sale information.

You will be asked for your cost basis in the property. You will need to make an allocation of the original purchase price to determine the cost basis of the portion of land that was sold.