Capital Gains and Losses
Questions and comments about tax rules for buying and selling stocks, mutual funds, real estate and other assets.
Trumps "Postcard" to File Taxes
Posted by: Bill18163, November 21, 2017 05:24PM
I know Trumps postcard to file our taxes is not law yet but how in theory would this be handled if it was.
I have a vacation home for sale that I will get somewhere in the neighbor hood of 250K. With what it cost me to build it and all the improvements I've made over 26 years I have 196K in it. How would you write off the 196K on a postcard? Has anyone heard of how this might be handled?

Re: Trumps "Postcard" to File Taxes
Posted by: Sven, November 21, 2017 05:46PM
I am sure somewhere on whatever simplified tax form may result from tax reform there will be a line where you report net long term capital gains and losses. On your facts you'd report $56,000 of long term gain. Maybe there will be a mini Schedule for sales of real property. What supporting documents you might have to attach to substantiate that your gain was only $56,000 is another story.

Re: Trumps "Postcard" to File Taxes
Posted by: Bill18163, December 16, 2017 04:51PM
In regards to my original post about selling my 2nd home. I have been reading through the new tax plan information posted all over the web to try to find out if they made any changes in the tax law that could possibly cost me money on the sale of this property. Would I still be able to deduct costs associated with the sale such as advertising the property for sale, attorney fees, transfer tax, etc. Would there be any problem listing purchases that increase the basis of the property? The buyers bank wants to push this sale into the new year. The agreement of sale contract ended on December 13th. They want my wife and I to sign an addendum to push the closing date into January. I have been somewhat scared of doing that because I don't know if there has been any changes in this sort of transaction in regards to the new tax law. If I am not mistaken in my reading of the contract I could walk away from this since the agreement ended on the 13th and we have not signed the addendum to extend it. I could keep the property with no problem. I don't have to sell it. We only wanted to sell it because we are both getting up in age and it is much harder to keep it up. Does anyone know if the tax law has changed in any way for this kind of sale that would be not in my favor?

Re: Trumps "Postcard" to File Taxes
Posted by: Sven, December 17, 2017 02:34AM
In very general terms tax brackets and their break points will be changing and that obviously will have an impact of how much of any net capital gain you might realize by selling a second home you get to keep. I have not seen anything that suggests selling a second home and how net gain, presumably, gets calculated has changed any. Keeping the second house could be more expensive if total SALT deductions are limited to $10,000. So keep reading and thinking, but I don't believe the basics of selling a house have changed.



Sorry, only registered users may post in this forum.