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by Rob Seltzer, CPA, PFS
Q: I would like to sell an uninhabited house I inherited and to which I have made improvements. What would be my tax liabilities?
You should report the gain or loss on Schedule D . The capital gain tax depends on what the rest of your return contains as well as how long you owned the property before selling. If you held the property for 365 days or less, you will be taxed on the gain at the same rate as the tax on your ordinary income. If you held the property 366 days or more, the tax on your gain will either be 5 percent, if you are in the lowest two tax brackets, or 15%, if you are in higher tax brackets. You will not owe a tax if you take a loss on the sale.
Rob Seltzer is principal of Robert Seltzer, CPA, PFS, in Beverly Hills.
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In accordance with IRS Circular 230, the information on this website is not intended or written to be used, and cannot be used as or considered a "covered opinion" or other written tax advice and should not be relied upon for the purpose of avoiding tax-related penalties under the Internal Revenue Code; promoting, marketing, or recommending to another party any transaction or tax-related matter(s) addressed herein; for IRS audit, tax dispute or other purposes.