How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Robin D. Your Own Question
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 14496
Experience:  15years with H & R Block. Divisional leader, Instructor
Type Your Tax Question Here...
Robin D. is online now
A new question is answered every 9 seconds

Closing cost on our main residence is this tax deductible,

Customer Question

closing cost on our main residence is this tax deductible
JA: The Accountant will know how to help. Please tell me more, so we can help you best.
Customer: we sold our home in Cincinnati ohio in july of 2015 we needed to repair numerous items from the inspections in order to sell at a very reduce price, these were in the neighborhood of $12000. are expenses deductible in 2015?
JA: Is there anything else important you think the Accountant should know?
Customer: we had built the home back in 1991 for $750,000.(8000 sq ft 3 story all brick hose)and had the home inured for $1,250,000. replacement costs less the lots. lots were $125.000. appraised by outside independent source in early 2014 for $825,000. We sold house after being on market for 2 years for $605,000. can we take a loss on this amount just as if it was the opposite and was sold for a profit of $500,000. IRS would want to tax 0n this amount.
Submitted: 5 months ago.
Category: Tax
Expert:  Robin D. replied 5 months ago.

Hello, I'm Robin. Welcome to JustAnswer. I'm reviewing your question now and typing up my reply. I'll post that in just a few moments.

Expert:  Robin D. replied 5 months ago.

The amounts you pay to sell reduce your selling price. If you sell for less then your cost (plus improvements) and you used the home for a personal residence (or even a second home) you are not allowed to use the loss unfortunately.

Almost everything you own and use for personal or investment purposes is a capital asset. Examples include a home, personal-use items like household furnishings, and stocks or bonds held as investments. When you sell a capital asset, the difference between the adjusted basis in the asset and the amount you realized from the sale is a capital gain or a capital loss.

You are correct that if you sell for a gain you generally are taxed on the gain (with the exception of your main home under IRC 121 you can exclude up to $500,000 of gain if married). Losses from the sale of personal-use property, such as your home or car, are not tax deductible.

Please let me know if you need clarification. If you do not then a positive 5 star rating is appreciated so I get credit for the response. (look for the STARS or SMILEY FACES)

Expert:  Robin D. replied 5 months ago.

I am checking back with you to see if you required more assistance on calculating the sale.

Customer: replied 5 months ago.
Full of CRAP
Expert:  Robin D. replied 5 months ago.

I understand. The tax rules are not forgiving and are unbalanced for fairness.