by The TaxResearchPro Team | Nov 3, 2015 | Personal Tax
My client is selling a primary residence that has $750,000 in capital gains. My client’s father moved his primary residence to an irrevocable trust which both the client and the brother inherited. When the property was transferred over, it came in appraised at $850,000. Now, the property can ideally be sold at a loss of $600,000. Can the losses on inherited property sold in Virginia be offset with the gains of the sale here in New York?
by The TaxResearchPro Team | Oct 22, 2015 | Personal Tax
My client purchased a home in her personal name. The client plans to rent the home during the summer as she has a personal residence. The client intends in moving this property into an LLC. If the client decides to convert the home back to a personal residence, does it matter that it is in an LLC for Section 121 capital gain exclusion purposes?
by The TaxResearchPro Team | Jun 11, 2015 | Personal TaxQuestion My client converted their second home to a rental in 2008. They bought it for $575,000 in 2007. The fair market value in 2008 was $450,000. I use this as the basis for depreciation. They sold the house this year. Can they recapture a loss of $125,000 in market value? Answer The short answer is that you cannot claim the $125,000 loss. The tax basis of the rental property is the lesser of the cost ($575,000) or the value when it is placed in service, plus any improvements, less any depreciation taken or $450,000 in this case. If there was a loss from a decline in value AFTER conversion to a rental, it is generally deductible, but that doesn’t appear to be the case. User: Accountant Location: VA References: IRS Publication 527; IRC Section 165 More rental property questions? Sign up for a free trial to our research support...