Sale of Second Home (Not Rental)

[avipulco]

Hello,

I purchased a home in 2022 in January and sold it in April. I did not use it for rent and just a little for personal use. I made a profit of the sale.

Do I put this information in the Investment Section?

It only asks for
* When did you receive this investment?
* Date sold or disposed
* Proceeds
* Total amount paid

then on the next page:
* I paid sales expenses that aren't included in the sale proceeds reported on the form 1099-S

I am surprised it does not ask me anything about commissions, property taxes, HOA fees, etc. 

Do I just add up all those numbers and put them in the sales expenses box?

Thank you for your help!

[SDJ50]

The sale of a second home would be the same as an investment because it was not your primary residence.

It will be a short term gain on Schedule D, because you held it for less than one year. The commissions and closing costs relating to the sale can be deducted as part of your cost basis. Taxes would be deductible as an itemized deduction on schedule B.

Hope this is helpful.

[avipulco]

Thank you!

So just to be safe. I am in the correct section in Turbotax to report the sale of this 2nd home (not a primary home, not a rental)?

What would I then fill in the SALES EXPENSES BOX?

[Mike9241]

HOA fees and possibly other costs are not deductible. 

[SDJ50]

Yes you should be in the Investment income section. It lists 1099B and Broker statements.  Your 1099S should be the Broker statement.  Enter one sale at a time, that should lead you to the page that asks for a description, sales price and cost. The sales price should be on the 1099S, the costs are something only you know. It will be what you paid for the property when you acquired it. I assume you have a broker statement from that acquisition. If not the cash you paid is your cost.  Any improvements you made to the property would also add to your cost.  Then add to this cost closing costs from your current sale. Costs include commissions to realtors, title insurance, filing fees. Such things as Property taxes and utility allocations are not deductible as cost of sale. 

Good luck,

SDJ

[avipulco]

Hello SDJ,

Thank you for your response. I think I am almost there.

So in the above Screenshot I have for Proceeds $100,000 because in my 1099-S Statement that is the only number I have for the Sales Amount. No other box has any content.  I sold the Property for $100,000.

I purchased the Property for $80,000. Between the purchase and sale date I improved the floor and appliances for about $7,000. Should I add those $7,000 to the $80,000 box or should I add those $7,000 on the next page in the box where I now have $5,000 where it says Sales Expenses NOT on 1099-S or Statement? See below.



The $5,000 above is an estimate I paid for commissions when I purchased and sold the property. I assume this goes here.

Thank you

[SDJ50]

Sorry for the delay I do not look at my email often.  I would add the $7,000 to the $80,000 cost, as well as the commission you paid on your purchase of the property. If you have completed your return and put it on the other page the end result is the same, so don't worry.  Looks like you made a good investment. Good luck on your tax return. 

SDJ

[avipulco]

Thank you SDJ50!

I think  I got it now. The cost basis was good to know, it makes more sense that way.

Thank you again!