Sale of second home

[dnrrascon]

We sold our second home in 2022. How do I itemize our realtor commissions and other capital improvements?  We have purchased desktop turbotax premier but cannot locate a spot to enter our capital improvements/commissions.  Do we need to itemize our deductions or complete attachment A? How do we complete form 8949 when the system states it will automatically complete it for us? Last question, do we create our own spreadsheet for tracking/auditing purposes and include the amount of commissions/capital improvements in the cost or other basis section?  Please help.

[MaryK4]

You can add the Commissions to Selling Expenses and the improvements will be Adjustments to Basis.  Please see Where do I enter the sale of a second home, an inherited home, or land on my 2022 taxes?

[dnrrascon]

We have reviewed that link to no avail. My questions remain unanswered. Please help.

[Vanessa A · Accepted solution]

Your capital improvements would be included in the cost or other basis along below your sale price.  After you enter all the information on the "Tell us about this sale" screen click continue, then on the next screen click done. 

Go two more screens until you get to "select any less common adjustments that apply" on this screen you can select "The reported sales price did not deduct all fees or selling expenses".  You can enter the commissions you paid here. 

You will also select "Any loss from this sale is not deductible for reasons other than disallowed wash sale" and then check this is personal use property. 

It is always a good idea to have a spreadsheet that you keep with your records for tracking/auditing purposes. 

[dnrrascon]

Do we need to fill out additional forms to show proof to the the IRS what capital improvements we made and who we paid? That is not clear.

Also, do we need to itemize, or can we take the standard deduction?

[JulieS]

No, you don't have to complete any additional forms other than what is previously mentioned. Do keep your documentation for this sale until at least April 18, 2026. 

[dnrrascon]

How do we upgrade from premier to assisted? This seems too complicated for us.

[Critter-3 · Accepted solution]

Ok ... you do NOT need to upgrade ... but if you do simply click on the UPGRADE option in the lower left of the menu bar.

All you need to do is  manually add up the original purchase price + the cost to buy + improvements made along the way + cost to sell  =   cost basis entered as just one amount.  There is no separate entry fields for these things.   Do not adjust the selling price ... just enter it as it is on the sales contract.  

And  taking the standard deduction or using itemized deductions  have NOTHING to do with the sale of the second home reported on the Sch D.  

[cmfalter]

....Forms to use?

[Critter-3]

@cmfalter 

Be more specific ... forms to use for WHAT?