realtor fee deductions
My mom died this last year and her house went to me due to preparation (living trust?). I sold the house in a month to disburse the funds to my sibblings. I sold the house for 350k and had to pay 1.5 realtor fees for the sale of the house. Can I deduct the 1.5 realtor fees off my taxes this year? She passed, the house became mine, I sold all within a month to two months. Thanks
I take the standard deduction previously.
Best Answer
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Hello!
Yes, when you report the sale of the home on your personal return, you will enter the amounts as we have discussed. It sounds like you have a good handle on that. Great job!
When you enter the sales information in the Stocks and Investments Sold section (the property would be considered an investment based on your situation), our software will ask you to enter the sale proceeds, selling expenses and your basis. The software will then calculate the loss as applicable to your situation.In your case, there is no gain as the basis is equal to the sales price. The selling expenses will reduce the net sale proceeds resulting in a loss.
Capital losses are limited to $3000 each year. So, based on your situation, you will be able to deduct $3000 the year of the sale and carryover the remaining $2,250 to deduct next year.
If you file your return with us this year and next, the loss will automatically carryover to simplify the process.
Answers
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****,
That is a great question!
The realtor fees paid to sell the home can generally be claimed as a selling expense when reporting the sale of the home. This will reduce the gain/increase the loss recognized on the sale of the home.
See page 14 of Publication 523 for an IRS-provided list of selling expenses:
https://www.irs.gov/pub/irs-pdf/p523.pdf
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Hello ****!
Welcome to FreeTaxUSA!
When a home is inherited, the basis of the home becomes the Fair Market Value of the home on the date that your loved one passed away.
When the home is then sold, the sale proceeds are reduced by the selling expenses. The net proceeds are then applied to the basis, resulting in a gain or loss.
If I understand your situation correctly, you inherited the home, sold the home and then disbursed the proceeds to your siblings, is this correct? If so, you will report the sale using the stepped-up basis like this:
Sale Proceeds: $350K, minus the selling expenses of $1.5K resulting in a net proceed of $348.5K. You will then enter your basis in the home and a gain or loss will be calculated accordingly. As you sold the home soon after inheriting it, the reduction from the selling expenses may result in an overall loss as the basis will likely be the same as the sale proceeds.If you sold inherited investment property in 2024, you can enter the sale in Stocks or Investments Sold in the Common Income section of our software.
If the sale resulted in a loss, you can claim a capital loss deduction if all of the following are true:
- The sale was a transaction where you didn't have a business relationship with the buyer.
- You sold the property to an unrelated person.
- You didn't use or convert the property for personal purposes.
Make sure to only enter your portion. For example, if you and three siblings inherited equal shares of a property that you sold for a gain, you'd split the gain four ways. You will only report the amount as applicable to your personal inheritance.
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the house was only in my name. my sales price was 350k and I paid 5,250.00 in realtor commission. so my cost basis is 350, since that was the value when I got the house but sold it for 5250 less which is 344,750 for the sale. I can put that loss in the form you mentioned above for stock transactions. am I on the right track? I am married so have no capital gains on 500k, but there are no gains correct? Thanks for such a good answer!
