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Discussion:Gain/Loss on Flipped Condo

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Discussion Forum Index --> Basic Tax Questions --> Gain/Loss on Flipped Condo


Discussion Forum Index --> Tax Questions --> Gain/Loss on Flipped Condo

UNC-CPA (talk|edits) said:

18 March 2014
Taxpayer, a semi-retired/part-time real estate agent, purchased a condo to flip in spring 2012 and later sold it in fall 2013. The TP is not in the business of flipping, incurred <$100 of repairs, made no election to capital carrying costs, and does not itemize. Can the property taxes and utilities paid in 2012 & 2013 be used to calculate the gain/loss on sale? Are the property taxes and utilities non-deductible?

Ckenefick (talk|edits) said:

18 March 2014
Are you putting it down as a LTCG on the 1040?

UNC-CPA (talk|edits) said:

18 March 2014
Yes, LTCG is the plan.

Ckenefick (talk|edits) said:

18 March 2014
Then you should take the property taxes on Schedule A (investment property) and they should also be included on Form 4952 as investment expenses. The utilities and HOA dues and Repairs should be 2% deductions (investment expenses) and should also be shown on Form 4952.

So, I think in your case, since the guy can't itemize, ND all the way around.

Sec 266 is out since we're dealing with already-improved property.

UNC-CPA (talk|edits) said:

18 March 2014
Chris, that's what I was thinking. Thanks for confirming.

Ckenefick (talk|edits) said:

18 March 2014
And thank you, for confirming your gratitude for me confirming.

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