INHERITED PROPERTY

[PSL106]

I put in the sale of inherited property but it would not let me take off other expenses or list them. 

It said I can only take off $3000.  My portion of the sale of the house is $69379. Expenses for  getting house ready to sell and fees are  $18954. I am at a loss for how to do this. Any suggestions.

[PattiF · Accepted solution]

The sale of the inherited property should be entered in the investment section where you may be able to use the expenses to reduce the gain that you had. The expenses are considered the cost basis of the inherited property. 

• Click on the Wages & Income tab
• Next click on I'll choose what I work on
• Scroll down the screen until you come to the section Investment Income
• Chose Stocks, Mutual Funds, Bonds, Other and select Start or Update
• The first screen will ask if you sold any investments during the year, answer 
• Did you get a 1099-B or a brokerage statement for these sales? Answer No
• Tell us about this sale, Click I'll enter one sale at a time
• The drop-down boxes can be filled out with the details of the timber sale

1. Description - inherited house with general location or address
2. Date sold - your records
3. Date acquired - your records
4. Sale proceeds - your records
5. Cost basis - your cost basis consisting of expenses for house preparation and selling fees

Here is a list of what you can add to the basis.

Home improvements may come into play when you sell your home because they're included in your home's adjusted cost basis. The bigger your basis, the smaller your capital gain, and that means less tax.

To qualify as an increase in the adjusted basis when you sell, the home improvement must:

• Add materially to the value of your home; or
• Prolong your home's useful life significantly; or
• Adapt your home to new uses

If any improvements or repairs were necessary to sell the house, those expenses can be added to the basis. 

Here are some examples of improvements:

• Remodels and room additions (including decks and porches)
• New or upgraded landscaping, irrigation, and sprinkler system
• Hardscape such as pavement, block or retaining wall, patio
• Fencing
• Swimming pool, spa
• Storm windows, doors
• New roof
• Central vacuum or security system
• Upgraded wiring, plumbing, and ductwork
• Central heating, AC, humidifier
• New furnace, water heater
• Filtration, soft-water, or septic system
• Built-in appliances
• New flooring or wall-to-wall carpeting
• Upgraded insulation
• Satellite dish

And here are some of the deductible fees that you can add to the basis:And some expenses that are listed on the settlement statement can be added to the basis. These include:

• Title fees
• real estate commissions
• documentary stamps
• credit report costs
• costs of an abstract
• transfer taxes
• home inspection
• flood certificate
• attorney fees, etc.  

[Mike9241]

add the selling expenses to the tax basis.