The way this works is that the seller has a capital gain
(or loss) and that gain is taxed (for inherited assets
) at the long-term capital gains rate
Long-term gains and qualified dividends
0% if taxable income
falls in the 10% or 15% marginal tax
15% if taxable income falls in the 25%, 28%, 33%, or 35% marginal tax brackets
20% if taxable income falls in the 39.6% marginal tax bracket
Capital Gain = Sales
price minus basis
And basis for someone who inherits, is the fair market value of the property
as of date of death of the person leaving the asset.
So, as you can see, the taxes for a seller of a property doesn't have to do with income
and expense (taxable income a deductions
) but rather about selling something for more that their basis and having a capital gain, and that gain being taxable at a special (capital gains rate) rate.
Now, as to your question ... any closing costs, commissions, even painting the house to get ready to sell that were paid by the seller ARE added TO their basis for purposes of calculating their gain.
So, yes, even there' not a deduction
per se, any dollars actually paid by the seller DO lower the capital gain, thereby lowering the sellers tax on sale.
Doe this help?
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