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Stephen G.
Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 6108
Experience:  Extensive Experience with Tax, Financial & Estate Issues
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I had to sue My brother to get our share of property jointely

Resolved Question:

I had to sue My brother to get our share of property jointely owned inorder for My sister and I to get any money from the property being controlled by our bother to settle he had to get a loan out for $300.000. He is now the sole owner of the property.

In the end both my sister and I each recieved $140,688.00 after taxes ($2,312.00) and legal fees ($7,000.00).

Since the property was purchased and paid for so long ago how can I determine the amount of capital gains tax I should pay? I have not received a 1099 or any other documents of any type.
Submitted: 5 years ago.
Category: Tax
Expert:  Stephen G. replied 5 years ago.
Did all three of you purchase the property originally or did you acquire it later by gift or inheritance?
Customer: replied 5 years ago.
After my Father passed away in 1982 my mother put the property into our names
Expert:  Stephen G. replied 5 years ago.

Was the property their personal residence and did your mother live in the property after she transferred title to you & your brother & sister? Is she still alive or if not when did she die? And if so did she remain in the property until she died? I need to know a little more about the history of the property in order to tell you how to determine the tax basis in the property.
Customer: replied 5 years ago.
Yes the property continued be her place of resisndece I was told she still maintains an apartment but also has been living in Puerto Rico now for quite sometime.
Expert:  Stephen G. replied 5 years ago.

Well, if prior to your father's death, they held the property jointly, then your mother's tax basis would have been equal to 1/2 of what they paid for the property, plus 1/2 of any improvements up until your father's death, plus 1/2 of the fair market value at his date of death.

Obviously, you may have to due some estimating to arrive at the figures.

Once you arrive at that figure, you would take 1/3 of that number & you'll have your initial tax basis; to that you would add 1/3 of any major improvements that you & your siblings paid for over the years, if any.
You would also add your share of any selling expenses to this figure, including any legal expenses to force the division of the property; that would be your tax cost for determining the gain on the sale of your interest in the property to your brother; the selling price would be the gross sales price, not the net proceeds as you would add the selling expenses to the initial tax cost as I previously described.

Depending upon what tax bracket you find yourself in, not including the capital gain, your federal capital gains tax could be anywhere from -0- to 15%.

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I'll be happy to answer any follow-up questions you may have.
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