For Estate Income Tax return (Form1041), are these items "Selling Expenses" on an inherited house?

[diycpa]

We siblings inherited a house, quickly found a realtor, followed her suggestions to paint, etc., had an estate sale, buyer made an offer we accepted, paid a plumber to repair things noted in the inspection, then went to closing within four months of date of death.  We did not live in the house.

We received a 1099-S with Box 2 Gross Proceeds shown.  May we include these items as Selling Expenses, all of which were clearly done to get the house ready to sell or to sell it?  I'm using TurboTax Business.  I expect that this will result in a Loss that will go to the beneficiaries.

1.  (All of these are shown on the Settlement Statement, HUD-1, so it'd be great to just use that total if possible)

-Realtor Commission

-Title items (Owners Policy, Search Fee, Binder Fee, Settlement Fee to Attorney)

-Sewer Assessment Letter

-Mail Away Fee

-Property Taxes (I've seen conflicting answers to this item)

2. (Other items I'd like to list as expenses of this investment property, if you believe they're allowed)

-Estate Sale costs

-Painting, etc., as suggested by realtor before listing house

-Plumber costs following inspection

-Insurance & utilities for period after death

Thank you for helping me with this!

[Anonymous_ · Accepted solution]

You cannot deduct typical ownership costs as expenses per 1.67-4 unless the property were used for business purposes or the production of income.

Those costs would include insurance, repairs, fix-up expenses, et al.

[Anonymous_ · Accepted solution]

The estate can deduct the likes of real estate commissions and fees charged for the estate sale as selling expenses.

Real estate taxes and attorneys fees paid by the estate can be deducted as such on Form 1041.