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I sold 60 acres of land ,it has been in the family for over…

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I sold 60 acres...

I sold 60 acres of land ,it has been in the family for over 100 years & was passed down to me & my brother. How is it taxed

Accountant's Assistant: The Accountant will know how to help. Please tell me more, so we can help you best.

It was the family farm years ago, but has been vacant for about 30 years. We rented it to the neighbor for cattle grazing & hunting

Accountant's Assistant: Is there anything else important you think the Accountant should know?

It sold for $230,000.00 I received 1/2

Submitted: 2 months ago.Category: Tax
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Answered in 35 minutes by:
4/2/2018
Tax Professional: Cole Parker, Certified Public Accountant (CPA) replied 2 months ago
Cole Parker
Cole Parker, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 113
Experience: Certified Public Accountant
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Hello, my name is***** have reviewed your question, please allow me a moment to type a response...

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Tax Professional: Cole Parker, Certified Public Accountant (CPA) replied 2 months ago

Was the land passed down upon the death of your father or mother or was it gifted before passing on?

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Customer reply replied 2 months ago
Passed down upon death of mother in 2000
Tax Professional: Cole Parker, Certified Public Accountant (CPA) replied 2 months ago

What you'll need to find out is the market value of the land upon the date of your mother's passing to obtain a new basis (this is called a stepped-up basis). Then the proceeds you received from the sale of the land minus the stepped-up basis will be what you pay the tax on. This should be taxed as a long-term capital gain at approximately 15%.

Please let me know if something does not make sense and I'd be happy to clarify :-)

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