A client sold their primary residence which included the house and 28 acres where they had lived for 12 years. There was no appraisal done with the sale by the seller. Should all of the 28 acres be excluded from tax as well as the home? If not, how many acres should be included with the house?
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If they sold the acreage with the house then their basis is the original purchase price plus improvements during ownership and the sale price is the amount on the 1099SBelieve nothing you have not personally researched and verified. -
Thinking maybe not enough information
Why would you exclude the 28 acres? Was the property ever sub divided - - Might be a reason
Was the original purchase cost the house and the 28 acres, then sub- divided with separate deeds to arrive at a cost
Taxpayer selling only the portion that was related to the House and retaining the remaining acreage?
Example - House - primary residence on 2.8 acres - if sold the value would be for house and acreage. No sub division _ Purchase price was house and acreage - if sold - house and the 2.8 acres
Other scenario would be 2.8 acres and house sub-divided and now have .8 acres for house and land and new sub- divided parcel of 2 acres - separate deed/title - allocation of purchase for sale of primary residence/subdivided acreage-
If house and 28 acres was sold as "one" parcel - that is what you would report as the primary residence, is what I am thinking
SandyComment
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if client sold home with the 28 acres , why do you want to separate the acreage from the home. it is all one parcel. and why does seller need to get an appraisal before the sale? sounds to me like client sold his principal residence with land, period.Comment
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Was it used as farmland? If so, I believe it needs to be prorated.Originally posted by IPS View PostComment
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