Tax question

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Tax question #4287336 02/16/25 02:55 PM 02/16/25 02:55 PM
Joined: Jan 2010 Posts: 3,787 south alabama countryjwh OP 10 point
countryjwh OP 10 point Joined: Jan 2010 Posts: 3,787 south alabama	Trying to figure something out. This is a persae. Parents paid cash for a house on a lake. 110k. Pretty much studio apartment. But. With a boat dock and water front on a big lake. This is a weekend house. They have had it for three years. They are wanting to sell it now. If they sell it for 165k and get that amount. How much will they be taxed on ? The entire amount. Or the profit ? I am calling the accountant tomorrow but I’m wanting to have ducks in a row. Nothing ventured, nothing gained. My phone screen does not always work right, usually a lot of misspelled words.... Need Help Posting Pics for Aldeer-- http://www.aldeer.com/forum/ubbthreads.php?ubb=showflat&Number=2447421#Post2447421

Re: Tax question [Re: countryjwh] #4287344 02/16/25 03:12 PM 02/16/25 03:12 PM
Joined: Jul 2011 Posts: 37,832 Boxes Cove 2Dogs Freak of Nature
2Dogs Freak of Nature Joined: Jul 2011 Posts: 37,832 Boxes Cove	Profit. Might get to deduct repairs, remodels and such. That's a guess on my part. "Why do you ask"? Always vote the slowest path to socialism.

Re: Tax question [Re: countryjwh] #4287346 02/16/25 03:17 PM 02/16/25 03:17 PM
Joined: Jan 2017 Posts: 4,872 Lower Alabama Andalusia 12 point
Andalusia 12 point Joined: Jan 2017 Posts: 4,872 Lower Alabama	Original cost plus documented improvements is the price the home would be valued at for their cost. Any amount above this figure they sell it for is taxed as gain. "It is the mark of an educated mind to be able to entertain a thought without accepting it"

Re: Tax question [Re: Andalusia] #4287377 02/16/25 04:50 PM 02/16/25 04:50 PM
Joined: Dec 2014 Posts: 905 calhoun co T timberman56 6 point
timberman56 6 point T Joined: Dec 2014 Posts: 905 calhoun co	Originally Posted by Andalusia Original cost plus documented improvements is the price the home would be valued at for their cost. Any amount above this figure they sell it for is taxed as gain. & should be reduced rate for long term capital gain I would think

Re: Tax question [Re: countryjwh] #4287385 02/16/25 05:07 PM 02/16/25 05:07 PM
Joined: Jan 2010 Posts: 3,787 south alabama countryjwh OP 10 point
countryjwh OP 10 point Joined: Jan 2010 Posts: 3,787 south alabama	Thank y’all. Bout what I was thinking. Nothing ventured, nothing gained. My phone screen does not always work right, usually a lot of misspelled words.... Need Help Posting Pics for Aldeer-- http://www.aldeer.com/forum/ubbthreads.php?ubb=showflat&Number=2447421#Post2447421

Re: Tax question [Re: countryjwh] #4287400 02/16/25 05:43 PM 02/16/25 05:43 PM
Joined: Feb 2009 Posts: 4,164 Huntsville, Al Bronco 74 10 point
Bronco 74 10 point Joined: Feb 2009 Posts: 4,164 Huntsville, Al	Is there not a loop hole if the gain is reinvested at a reasonable time? "We have an opponent in this state that we work every day, 365 days a year, to dominate."

Re: Tax question [Re: Bronco 74] #4287416 02/16/25 06:05 PM 02/16/25 06:05 PM
Joined: Feb 2007 Posts: 22,235 colbert county cartervj Freak of Nature
cartervj Freak of Nature Joined: Feb 2007 Posts: 22,235 colbert county	Originally Posted by Bronco 74 Is there not a loop hole if the gain is reinvested at a reasonable time? Same year I thought “Socialism only works in two places: Heaven where they don't need it and hell where they already have it.” ― Ronald Reagan

Re: Tax question [Re: countryjwh] #4287421 02/16/25 06:16 PM 02/16/25 06:16 PM
Joined: Sep 2001 Posts: 1,022 AL J jhardy 6 point
jhardy 6 point J Joined: Sep 2001 Posts: 1,022 AL	Be careful, more to it than that.

Re: Tax question [Re: cartervj] #4287583 02/16/25 10:42 PM 02/16/25 10:42 PM
Joined: Jan 2017 Posts: 4,872 Lower Alabama Andalusia 12 point
Andalusia 12 point Joined: Jan 2017 Posts: 4,872 Lower Alabama	Originally Posted by cartervj Originally Posted by Bronco 74 Is there not a loop hole if the gain is reinvested at a reasonable time? Same year I thought Not sure that applies to a second home. "It is the mark of an educated mind to be able to entertain a thought without accepting it"

Re: Tax question [Re: jhardy] #4287604 02/16/25 11:33 PM 02/16/25 11:33 PM
Joined: Jun 2007 Posts: 1,788 Sweet Home Moss 8 point
Moss 8 point Joined: Jun 2007 Posts: 1,788 Sweet Home	Originally Posted by jhardy Be careful, more to it than that. 1031 exchange. Lots to it. You need an attorney to act as trustee and make it work or you get hit hard. There are timelines and disclosures that have to happen before any transactions, etc. There're things you can do with an accountant if you can find a good one. Someone else mentioned a way to increase your basis in the property. If you have the ability to qualify as a real-estate professional,you can do a few other things. Owning an AirBnB would help in this case. Go get an accountant, Lawyer, real estate agent, etc. O God, you are my God; early will I seek you. Psalm 63:1