Vacant Land Sale

[SensibleandHourly]

Hello, 

Curious the taxable ramifications when a client has held vacant land for twenty years, and finally sells it? Is this simply a long-term capital gain situation? And can all those years of property taxes be considered when calculating cost basis? 

Thank you,

Dawn 

[IRonMaN]

Capital gains.  For any of those 20 years were property taxes previously deducted?

[BobKamman]

The question isn't whether the taxes were deducted, but whether an election to capitalize them was filed for any of those years.  

[George4Tacks]

I know that this is not even remotely related to this question, but I thought it was remotely related to this question and I am weird, so here goes.

[Jim-from-Ohio]

Can we then deduct unrealized losses?

[SensibleandHourly]

Highly doubt taxes were capitalized. However, the couple are very detailed and likely could go back through twenty years of taxes to determine if property taxes had been itemized and/or claimed on their State taxes. Is there a way for the software to document that? 

Happy Friday. 

p.s. Definitely sharing the comic relief with a certain someone. 😉 

[abctax55]

"..... whether an election to capitalize them was filed for any of those years. "

Don't overlook @BobKamman  's comment, even if your clients can determine whether deducted or not in the prior years.