Can I claim the amount of money that I paid to clean up the house for the sell of my second home?

[tuanngnttax]

Last year I sold my second home and I spent around $1500 to rent a dumpster and to pay a company to do cleaning.  Can I claim this $1500 as a selling fee or expense?

[JamesG1]

Cleaning, maintenance and repairs would be an ordinary and necessary expense.  Make sure that you keep copies of your receipts and records should a tax authority question the cost at a later time.

[tuanngnttax]

From Turbo Tax Home & Business, where can I enter this expense?

[JulieS · Accepted solution]

Yes, this cost is a sales expense and will reduce your gain.

This is how to enter it in TurboTax Home & Business:

1. Select Personal from the top row of tabs, then Personal Income,  toward the upper left corner. 
2. Click I'll choose what I work on, on the right.
3. Scroll down and look for Investment Income.
4. Click on Start or Update to the right of Stocks, Mutual Funds, Bonds, Other.
5. If you have already entered the sale here, click Edit to the right of your entry.
6. If you have not yet entered the sale, click Add More Sales.
7. Answer the first question No.
8. On the screen, Tell us about this sale, pick the first option, I'll enter one sale at a time. 
9. Fill in your information about the sale. For Holding period select C if you owned to home less than one year or F if you owned the home more than one year. 
10. Continue until you get to Select any less common adjustments that apply. 
11. Select the first option and enter your sales expenses.
12. If the sale was a loss, also select the fifth option and indicate the property is a personal use property. 

[tuanngnttax]

By the way, my title company also deducted $1726 for the property tax from my the final amount during the closing.  I think I can include this amount $1726 in this box too right. Is this correct?

[CatinaT1]

No. This is not a selling expense. This is an itemized deduction.

You can deduct the property tax paid with closing, but be aware that this will only affect you if you itemize your deductions.  

You will enter this where you entered your property tax for your first home; Federal>Deductions & Credits). Also, be aware that The Tax Cuts and Jobs Act implemented a $10,000 limit on State and Local Income Tax for a married couple. 

[tuanngnttax]

Then it is totally not fair at all.  You are telling me that I also have to pay tax for the amount $1726 (property tax deduction during closing).   I sold my 2nd house for $185k and took home the amount ($185k - $1726). You are telling me I have that I can't deduct the property tax amount from the $185k and I have to pay tax for that $1726.  That doesn't make sense at all.  Are you really sure?

[AnnetteB6]

Yes, property tax paid is not a selling expense.  It can be claimed as a deduction on Schedule A Itemized Deductions, but it cannot be included as a selling expense. 

If it was deducted from your proceeds from the sale of your house, then it was the prorated amount of property tax that you owed for the property for the period of time in the year that you owned it.  You can enter it as a deduction just like you would have deducted it for any other year that you owned the property.

@tuanngnttax 

[tuanngnttax]

As I rethink about this, may be you are right. Just like every year, I have to pay property tax from my own cash and I have to pay tax on my income. I normally get a little dollar amount back when I itemize the property tax amount.