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New Member
posted May 31, 2019 5:46:27 PM

Where do I enter itemized expenses for inherited home which sold, 1099-S? We had to do a lot of mold removal which was very costly. Can I deduct this from gain?

In searching, some answers are to deduct expenses from cost basis; however, I cannot find anywhere to itemize these deductions.  We spent a great deal of money getting the property habitable due to mold/mold removal.  Also would like to deduct expenses for selling property which were not deducted on the 1099-S.  Need help finding how to proceed.

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1 Best answer
Level 15
May 31, 2019 5:46:29 PM

Any home improvement or selling costs that can be deducted are just added to the cost basis or subtracted from the sales price used to determine the gain on the sale. There is no place to enter them on your tax return. Keep a record of them and how they were used to adjust the cost basis or reduce the selling price. If you received a 1099-S, it is best to adjust the basis rather than the selling price so that the selling price matches what the IRS receives on the 1099-S.

Here is an article that describes what is deductible and can be added to the basis or subtracted from the selling price: http://www.nolo.com/legal-encyclopedia/when-home-sellers-can-reduce-capital-gains-tax-using-expenses...

4 Replies
Level 15
May 31, 2019 5:46:29 PM

Any home improvement or selling costs that can be deducted are just added to the cost basis or subtracted from the sales price used to determine the gain on the sale. There is no place to enter them on your tax return. Keep a record of them and how they were used to adjust the cost basis or reduce the selling price. If you received a 1099-S, it is best to adjust the basis rather than the selling price so that the selling price matches what the IRS receives on the 1099-S.

Here is an article that describes what is deductible and can be added to the basis or subtracted from the selling price: http://www.nolo.com/legal-encyclopedia/when-home-sellers-can-reduce-capital-gains-tax-using-expenses...

Level 15
May 31, 2019 5:46:30 PM

Does that include the mold removal?

New Member
May 31, 2019 5:46:32 PM

Thanks, Texas Roger, that helps.

Level 15
May 31, 2019 5:46:33 PM

To answer SweetieJean's question, IRS Pub. 17 in the section on Basis of Property states that the cost of improvements having a useful life of more than 1 year that increase the value of the property can be added to the basis in property. It would seem that mold remediation would fall into that category.