selling of land

[Ken]

I think we talked about this a couple of years ago, but I forget what the answer was.
I have a client who bought a piece of land with a home on it and lived on it for a few years.
last year he split the land and sold part of it. He is still living in the house.
Is this taxable or is it still considered part of the origional purchase and thus exempt?

He only made like $19000 profit on the sale.
somewhere in the back of my mind I remember someone saying a couple of years ago that he had a year or so to sell the house or else the land would be taxable.

[BP.]

Ken, TTB, p. 6-20, bottom of right hand column.

[Ken]

thanks BP

Thanks a lot BP. I knew we had talked about this before. That was just what I needed.
I am going to post another question about these same parents. They had a rental house that they sold to their children for $1.00
Of course there will be a loss on this, but I dont think they should be able to claim this loss, do you?

[BP.]

Ken, this would be treated as a gift, wouldn't it? See Pub 544, Bargain Sales.