Sale of inherited home > expenses of sale

[alaska]

haha

of that salmon from Alaska.

Haven't you heard? The salmon are gone! Nah, but the commercial fishers have been cut back- hope it turns around. AND hoping someone will grace me with some fresh salmon soon, I can't get out of the office!!!

[TAXNJ]

Send some....

Thank you SO much! I had looked thru my TTB repeatedly as well as looked at the online library (along with IRS site & many others!). I think I was getting hung up on the inheritance part of this. I recall one of my instructors- many moons ago- telling me that I always get hung up on some tiny part of the picture.... I LOVE the worksheets in TTB. Thank you again- have a great season!

of that salmon from Alaska.

[alaska]

oh thank God!

Thank you SO much! I had looked thru my TTB repeatedly as well as looked at the online library (along with IRS site & many others!). I think I was getting hung up on the inheritance part of this. I recall one of my instructors- many moons ago- telling me that I always get hung up on some tiny part of the picture.... I LOVE the worksheets in TTB. Thank you again- have a great season!

[TAXNJ]

Starting at....

I seem to recall a handy dandy worksheet in either TTB or Taxtools??

TTB tab 6-2

[ATSMAN]

Mortgages stay out of the equation. $195,000 sales price - the FMV at time of inheritance ($172,000) = $23,000. Now you subtract the attorney fees, realtor fees and any closing costs paid by the sellers. Plus any carrying costs involved in the property, ex. electric, gas, taxes, maintenance etc. Looks like they are in for a loss.

I seem to recall a handy dandy worksheet in either TTB or Taxtools??

[Twin Turbo Z]

Mortgages stay out of the equation. $195,000 sales price - the FMV at time of inheritance ($172,000) = $23,000. Now you subtract the attorney fees, realtor fees and any closing costs paid by the sellers. Plus any carrying costs involved in the property, ex. electric, gas, taxes, maintenance etc. Looks like they are in for a loss.

[alaska]

I was dreading having to ask for help on this... I just can't wrap my mind around what makes sense with this.

Client (& sibling) inherited a home. Neither lived there nor rented it out. They spent a year trying to sell it, as there were issues with it not being 'financeable'. It finally sold. My client was issued a 1099-S for 1/2 of the sale price, which is WAY more than the check that was cut after expenses were paid. I was provided with the settlement statement & divided all expenses in half. I am 2nd guessing what can be counted as expenses of sale. There are the regular commissions, attorney, bank fees- (the house was nearly foreclosed on prior to sale). So, what of the existing mortgage that was paid off? Is this an expense or not? It was paid off out of the sale proceeds.

FMV on date of death (home & land)$172000 (by tax rolls)

Sale price $195000

Existing mortgage payoff $125000
2nd mortgage payoff $8000

Other misc expenses (attorney, RE agent, Title Fees, etc) $32000

State taxes $8000

These are round #'s- but it gives the just of what I'm looking at. And these are the totals (not divided by half)
B/T/W the 1099s shows $10000 (1/2 of sales price), and client got a check for less than $10,000.

Sooooo, I made it difficult- but does she get to use the mortgage as part of expenses? And what about amount remitted to state?

THANK YOU!!!