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Tax Implications for Sale of Vacant Land
Posted on 2/6/17 at 1:06 pm
Posted on 2/6/17 at 1:06 pm
Just sold inherited land in Mississippi. I presume that I will be on the hook for capital gains tax -- would I owe taxes in Louisiana or Mississippi?
Land was purchased by my grandfather in 1943, my mother inherited and deeded to me (keeping a life estate for herself).
Will we owe capital gains on the difference btwn his purchase price and our selling price or when it was inherited?
Land was purchased by my grandfather in 1943, my mother inherited and deeded to me (keeping a life estate for herself).
Will we owe capital gains on the difference btwn his purchase price and our selling price or when it was inherited?
This post was edited on 2/6/17 at 1:07 pm
2
Posted on 2/6/17 at 1:36 pm to LSUfan2008
Generally the person that inherits the property gets a step-up in basis to the fair market value at the date of death. Your mom's basis would be that step-up basis amount. Read this IRS Q&A about your basis after the gift.
When did your mom inherit the land, and when did she gift it to you?
When did your mom inherit the land, and when did she gift it to you?
Posted on 2/6/17 at 5:28 pm to CubsFanBudMan
Mom inherited in 2003 and put in my name in 2006.
Posted on 2/6/17 at 6:11 pm to LSUfan2008
Generally inherited assets are stepped up to FMV. gifted assets have a carryover basis (their basis = your basis).
You'll owe tax on the appreciation since 2003.
Consult your tax advisor.
You'll owe tax on the appreciation since 2003.
Consult your tax advisor.
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