I am the successor trustee of my Moms estate. Recently we sold land and a cabin in California, and distributed the proceeds to the three beneficiaries. However, the title company withheld 3.3% of the gross sales price, about $9400.
I'd like to claim a loss or no gain and get back this withholding. Since the date of death appraisals were greater than the gross sales price by $120000 can I claim a loss and get back the $9400 when I file taxes on the estate?
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Whatever was withheld by the title company for the state has to refunded by the state, if a refund is due.
You can report the loss on your 1041 and distribute the loss to the beneficiaries if this is the estate's final return.
Thanks for the quick reply. One follow up question: To claim a loss, do I provide copies of date of death appraisals to the CA Franchise Tax Board?
I'm not certain about CA so I can't really provide an answer.
Generally, you would want one for federal income tax (estate) purposes if there was a long gap between the date of death and the sale.
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