Sale of a home with Divorce Question

[melfiles]

OK - a little bit of an odd situation.

I built a home with my ex in 2015. We paid cash for the land. We financed the dwelling and paid over and above for some additional add-ons for the home. (about $40k over, paid in cash)

We divorced in May and we sold the house in Aug for 2x what we financed the original loan at (without the land and additions factored in). It was a 55/45 split. We are filing separate this year. I read that you each do 50/50 on your individual taxes. 

Do I claim 55% as my the portion of the sale? And can we add the land and extras to the 'cost' of the original home? Help!!!

[Mike9241]

did the divorce decree specify a split? if not since you got 55% of the proceeds you should have gotten a 1099-S for 55% of the gross sales price and that's what you report. you also report 55% of the costs that include land, cost of building the dwelling including add-ons, any subsequent capital improvements,  and certain closing costs for the financing. the mortgage balance itself does not enter into calculating gain or loss

you may want to review the IRS PUB on home sales

https://www.irs.gov/site-index-search?search=home+sale&field_pup_historical_1=1&field_pup_historical... 

most of the time the split is 50/50 so that's why it is common 

use the home sale worksheet in TurboTax. it will compute the excludable gain.   the maximum is $250,000 for you. 

[melfiles]

Yes, the decree does state 55%. I didn’t receive a 1099-s but maybe I should wait just a little bit longer for additional docs. Thank you for the info. I wasn’t sure if I could claim the land purchase since it was cash. It’ll definitely drop the gain considerably.