Deducting loss from sale of a property

sdRocky
sdRocky Member Posts: 2 Newcomer
in General

I purchased a property in 2022. After spending a large amount on improvements, I had to sell it in 2024 for a large loss.

How can I deduct that loss on my 2024 taxes? Do I use Section 1231?

Answers

  • JMSSGV
    JMSSGV Member Posts: 243

    What kind of property was it? Was it held for investment purposes? Was it rented? Did you have personal use? All of those things factor into determining how a loss might affect your taxes.

    You may want to review IRS Publication 544, "Sales and Other Dispositions of Assets" for more detailed information. https://www.irs.gov/publications/p544

  • sdRocky
    sdRocky Member Posts: 2 Newcomer

    Thank you, JMSSGV. I will read that publication.

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