I inherited a house, was in my name and sold it within 7 months of inheriting. I have a HUD form that includes Government Recording and Transfer Charges and 1st half proper taxes to the county. Where do I record the fees incurred in selling?
all expenses at closing go on Form 8949 as an adjustment to the gain/loss on the sale transaction.
What section in turbo tax do they get entered under?
Thanks
I think the real estate taxes do not belong on form 8949 but schedule A as taxes.
Yes.
If you inherited this house and did not live in it as your home, you will enter the sale of this property under
For TYPE select "Other"
Enter the information from the 1099-S and your records as if you had a 1099-B
Name it "Inherited House" or something similar
Select "Second Home"
Select "I inherited it"
Type Inherited House or the address or something else suitable for the Description
Enter the date sold
Enter the selling price- Enter the amount you received which would be the selling price less selling fees, such as commissions paid and Transfer tax, BUT NOT PROPERTY TAX PAID. You will enter the property tax paid later
“Transfer taxes (or stamp taxes).
…. If you are the seller and you pay them, they are expenses of the sale and reduce the amount realized on the sale.”
The property tax withheld is treated as if you paid them directly to the county, so add that to any other property tax you paid during the year under:
The additional property tax will only matter if you Itemize Deductions.
Inherited Property is treated as "Long-Term" for gain or loss.
If the value of the property stayed the same from the date you inherited it until you sold it, you will have a loss in the amount of the selling fees.
If the value of the property decreased from the date you inherited it until you sold it, you will have a loss in the amount of the selling fees plus the decrease.
If the value of the property increased from the date you inherited it until you sold it, you will have a gain in the amount of the increase less the selling fees.