You will have to pay Capital Gains tax rates if you have a gain on the sale and you owned the property for over a year. If you did not, the gain would be taxed at the same rate as your other income. The best way to calculate the tax burden would be to enter the sale in TurboTax.
This sale would be entered in the
investment section. To get to this to the section:
- In your open Federal return,
select Wages & Income
- Scroll down to Investment Income and Show more
-
Start or Revisit Stocks, Mutual Funds, Bonds Other
- Answer "No" to "Did you receive a brokerage statement?"
- On the page "Choose
the type of investment you sold" select the radio button for 'second home' and
continue to enter the property information and your proportionate share of the
sale proceeds.
- On the page "Tell Us
How You Acquired This Home" enter how you acquired the home (gift) and continue with
the interview. Gain/loss is computed and moved to appropriate form for your
proportionate share.
Please see the IRS' FAQ Basis (Value) of a gift for instructions on how to determine the cost basis of your home.
Note: If you
received a 1099-S for the sale of the home, make certain the proceeds are
recorded for your share only. If not, contact the payer for a corrected form.
