Spas Florida

Would i have to pay any capital gains taxes for selling my Villa in florida?

Would i have to pay any capital gains taxes for selling my Villa in orlando florida. I bought it five years ago for $270.000 and will be selling it for approx $180.000 and it has been running at a loss over the past five years. also is there any benifits I can claim for my loss.

Public Comments

1. You must and should claim it. If you didn't use it for personal purposes, then it was an investment. It should be reported on 1040 Schedule D. Under "Proceeds", enter the gross selling price (the first line of the HUD Settlement Sheet). Then, add together the following: Purchase Price + Settlement Charges you paid during purchase + Settlement Charges you paid during sale + what you paid for improvements (not repairs...don't include "value" for your labor) + other costs to purchase and sell like flying/driving to settlement / fax charges / postage charges Added together, this becomes your basis. Enter it on Schedule D too. The difference will be your capital loss. If you rented it out, things are a little different. You have to recapture any depreciation you took or should have taken...but this will be minimal compared to your overall loss. Seek a professinal tax advisor. You will use any capital loss to offset your other net capital gains. If this loss exceeds your net capital gains, you can use up to $3,000 of it to offset other income. Any remaining capital losses carry-over to next year. You keep offsetting capital gains and up to $3,000 of other income until either you die or use them up. So, by all means, record the sale on Schedule D and enjoy the tax benefit. After all, you did lose good money on the deal...you might as well reap some tax benefit. You know they want their taxes when you have gains, why not take legal tax advantage of the loss.