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My mother transferred her house to me in 2013. she became…

Hi, my mother...

Hi, my mother transferred her house to me in 2013. she became unable to live alone in 2017. we had to sell the house. how do I report it in my taxes for 2017.i received a 1099-s from the closing attorney. it states gross proceeds at 18000.00 the house was originally purchased for 6200.00 in 1973 by my mother. any advise would help. thanks.

Accountant's Assistant: The Accountant will know how to help. Is there anything else the Accountant should be aware of?

The house is in Pennsylvania. I live in West Virginia.

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3/26/2018
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 18,356
Experience: 15years with H & R Block. Divisional leader, Instructor
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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.

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Your mother gave you the house so you report on form 8949 the original cost with any improvements over the years added to that. Then you report the sale price less the cost to sale (maybe realtor commissions?).

Any amount over the adjusted cost will be your gain and the gain is what you pay tax on. Make sure to classify this as LONG TERM on the 8949 so you receive the lower capital gain tax rate.

You will also need to report the sale on a Nonresident PA return.

Please let me know if you need more information.
If not then please scroll up to see the STARS to rate so I am credited.

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Customer reply replied 4 months ago
as I reviewed the deed, I saw that it was transacted as a sale to me for 1.00 I'm not sure if the answer applies to this now. can you update the info? thanks.

Te IRS sees that as a gift and you retain her cost along with improvements.

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Did that clarify?

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Please let me know

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Customer reply replied 4 months ago
If I read the info , I need to fill out form 8949 & it will be reported as a gift. I can use the original cost & sales costs as deductions from the gross proceeds on the 1099-s form. That's what I must report as capital gains. Correct?

That is correct.

You are most welcome.
A positive 5 star rating is appreciated so I am credited for assisting.

Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
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Experience: 15years with H & R Block. Divisional leader, Instructor
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