I purchased a single family residence in July 2011 in the amount of $295,000 (paid cash) I'm now selling the property for $360,000. It's in escrow. Are the following items a tax right offs; property taxes, improvements totaling $16,000, closing cost, realestate agents fees? The other question is can I use a 1031 exchange if I've had the property for only one year and never rented it? Thx
spoke to the person that file my income tax returns and searched internet google and irs.gov
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Hello and thank you for using Just AnswerAre the following items a tax right offs; property taxes, improvements totaling $16,000, closing cost, real estate agents fees?
The improvements add to the cost and the real estate agent fees either subtract form the sale price or add to the cost depending on which transaction you are asking about, the buy or the sale.
can I use a 1031 exchange If the purchase of the property was for investment (no personal use of the property at all) then it would fit into the 1031 rules. You must follow the rules for the 1031 to be allowed. The time to identify the replacement property and the exchange period as well as the use of the qualified intermediary are very important.
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