Posted on: 25th Sep, 2009 12:12 pm
Hi,
I bought a piece of land for $79,000 almost three years ago. My intention was to sell my home (in a different city) and build on the vacant land. Basically, I could not sell my home, so I am selling the land now for $89,000.
However, I did put in $1,900 in the vacant land (making the concrete sidewalk). With the commission to the real estate agent, I would make a very small profit on this land. (If I count how much I paid in property taxes over the three years, I would be making a loss).
Anyhow, my question is this: What is my gain that I owe taxes on and what taxes (capital gains or income)? Do I include the commission, the cost of the sidewalk, and the property taxes I paid in computing the gains?
Thanks.
I bought a piece of land for $79,000 almost three years ago. My intention was to sell my home (in a different city) and build on the vacant land. Basically, I could not sell my home, so I am selling the land now for $89,000.
However, I did put in $1,900 in the vacant land (making the concrete sidewalk). With the commission to the real estate agent, I would make a very small profit on this land. (If I count how much I paid in property taxes over the three years, I would be making a loss).
Anyhow, my question is this: What is my gain that I owe taxes on and what taxes (capital gains or income)? Do I include the commission, the cost of the sidewalk, and the property taxes I paid in computing the gains?
Thanks.
You will need to pay taxes on $10,000/-
Unless you show it as an investment property, you cannto dedcut the expense you had with real estate agent commission
Unless you show it as an investment property, you cannto dedcut the expense you had with real estate agent commission