Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

I recently sold dirt to the DOT for a new highway project.

Customer Question
The barrow pit is rather...
I recently sold dirt to the DOT for a new highway project. The barrow pit is rather large and will never be farmed again. Is there a tax write off, depreciation schedule or some other credit I can apply for?
Submitted: 7 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 8 hours by:
6/2/2010
Tax Professional: Anne, Master Tax Preparer replied 7 years ago
Anne
Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 2,439
Experience: Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
Verified
Hi Jacustomer-rr6upiof

Thank you for using justanswer. If I'm following your question, you sold dirt from some land that you owned. That means that you have some sort of basis in the dirt (even though I know this may sound a little strange, since most of us don't normally consider dirt as necessarily have a cost basis, however, its really no different than if you have sold timber that stood on the land)

I would think that you could arrive at a reasonable cost basis of the dirt by asking a Realtor what the land would have sold for before the dirt was removed, and what that particular piece of land might be worth now that the dirt has been removed, and the difference would be your cost basis. (You will need to keep good records in case you decide you actually want to sale the actual piece of property at a later date, and you won't want to "double dip" on the cost basis)

If you are in the business of selling dirt, then you would report the sale on 2009 Form 4797Sales of Business Property .

If this was a 1x sale, then you would report
sale on 2009 Form 1040 (Schedule D,

In either case, you would only pay tax on the difference between your cost and the sales price, plus if you owned the land (and the dirt) more than 1 year, the profit would be taxed at the more advantageous capital gains tax rate (maxed at 15%)

I hope this helps.
Ask Your Own Tax Question
Customer reply replied 7 years ago
I need more information as to how to claim it and only pay the 15%. I claimed it on last year's taxes and it raised my tax rate as it was considered income and not capital gains. We have more that will be added this year so I'm anxious to know if I can claim a refund from last year and how to do this year. Hope I've been clear with my explaination. Don
Tax Professional: Anne, Master Tax Preparer replied 7 years ago
Hi Don

You may amend last year's tax year by filing Form 1040X Amended U.S. Individual Income Tax Return to take advantage of the 15% capital gains rate.

You will need to include either the 2009 Form 1040 (Schedule D, or the 2009 Form 4797 whichever applies. This form can be tricky due to its new format, so you may need to find a CPA, Enrolled Agent, or other professional tax pro familiar with the form to either prepare it for you, or walk you thru the steps of preparing it.

I hope this helps, and best of luck to you.










Edited by Anne on 6/2/2010 at 4:15 PM EST
Ask Your Own Tax Question
Customer reply replied 7 years ago
Since I am away from home at this time I will not be able to follow thru on your advice until next week. Thank you. I'll get back to you then.
Tax Professional: Anne, Master Tax Preparer replied 7 years ago
No Problem. Thank you for letting me know, and I'll be around if you have any follow up questions.
Anne
Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 2,439
Experience: Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
Verified
Anne and 87 other Tax Specialists are ready to help you
Ask your own question now
Ask Anne Your Own Question
Anne
Anne
Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 2,439
2,439 Satisfied Customers
Experience: Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses

Anne is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
What are the taxes rates 2016 for term gains in irrevocable
what are the taxes rates 2016 for long term gains in irrevocable trusts … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
727 satisfied customers
Given that the current 1041 tax rate on 401(k) income is
Given that the current 1041 tax rate on 401(k) income is $3206 + 39.6% over $12,400, what will be the new tax rate and will it apply for 2017?… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
Is the sale of customer list a capital gain or ordinary income?
Is the sale of self-created intangibles, such customer lists, digital files, web sites, etc subject to capital gain or ordinary income treatment?… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Are you familiar with Capital Gain taxes on rental property?
Are you familiar with Capital Gain taxes on rental property? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
I sold a rental property at a loss (no capital gains);
I sold a rental property at a loss (no capital gains); however should I pay the $133,000 on the principal of my house I owe 166,000 at 2.8% or buy another rental? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
We have $400,000 in capital gains for the sale of our
We have $400,000 in capital gains for the sale of our California home of … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
I need to know how to calculate capital gains tax on a
I need to know how to calculate capital gains tax on a rental property I am selling so I know how much i will have to pay on my 2017 tax return. Can you help? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Estate capital gains tax rate for 61, single, unable to
estate capital gains tax rate for 61, single, unable to work, is claimed as a dependent form sister,only income collects $500 month stipend from gov., which pays for health insurance and meds. is gett… read more
emc011075
emc011075
Senior Tax Specialist
Bachelor's Degree
16 satisfied customers
What is the capital gains tax on proceeds of the sale of a
What is the capital gains tax on proceeds of the sale of a home? … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
How to report the sale of a property outside US? How to
How to report the sale of a property outside US? How to claim the taxes paid abroad on the profit made by selling property overseas?… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
What would the federal and state tax rate percentages be for
What would the federal and state tax rate percentages be for a $7700 IRA early withdrawal in Ohio?… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,466 satisfied customers
Do you have to pay BIRT tax on capital gains from sale of
Do you have to pay BIRT tax on capital gains from sale of rental real estate … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
What is the income tax rate if it is not withdrawn from the
Hi! What is the income tax rate if it is not withdrawn from the LLC? The owner has not withdrawn any balance from the business all the amount reinvested into the business. Thank you!… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,466 satisfied customers
Does an IRS agent qualified to prepare capital gain taxes, I
Does an IRS agent qualified to prepare capital gain taxes … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
727 satisfied customers
I need the depreciation rate for my 2014 tax return, I now
I need the depreciation rate for my 2014 tax return My name is*****: What kind of computer do you have? Customer: I now have a lenovo and daughter filed for me so not to sava on here … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
Second opinion] Has the tax rate in Peru on capital gains
Second opinion] Has the tax rate in Peru on capital gains for non residents recently been changed? I heard it is now 5% and no longer 30%.… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Has the tax rate on an inheritance for non residents
Has the tax rate on an inheritance for non residents recently been changed? Iv'e been told it is now 5% and no longer 30%.… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,466 satisfied customers
What is capital gains tax rate for sale of home: My mom is
What is capital gains tax rate for sale of home: My mom is selling her home and has zero income. She is on social security. … read more
Richard
Richard
Tax Attorney
Doctoral Degree
4,310 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x