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Taxes and Sale of Property--Advanced Question
I have been busting my tail trying to find this answer, and it dawned on me..ADVICENATORS! You people always know how to help.
I am selling land in a different state other than my primary residence that was gifted to me over a period of years for $285,000. (no gift tax)(no depreciation)
My Capital gain is $95,000. I understand I will pay capital gains tax on that amount at a rate of 15%. I also have a substantial income from my job and my husbands job.
My questions; What part of the sale of the land will count as income? The entire amount of the sale? The amount minus the capital gain tax? Or only the gain?
I am aware I can deduct the legal expense for the sale.
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Since this was a gift, I believe you will be taxed on the full value but I may be wrong.
Since the land was gifted to you over a period of years this may be a tricky tax situation. It maybe that you will be taxed on the amount the land has appreciated in value but it is truly worth the money to get a tax accountant to figure this out for you. It shouldn's cost more than $100 and even less if you include it with your regular taxes for that year.
Secondly there is the One time option to opt out of Capital Gaines. If this is all going to be cash when the sale happens this might be something you are interested in. Also there are some very good investment options that you should look into to help you avoid some of the taxes.
I highly recommend a financial advisor.
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