I sold a building that I inherited 30 years ago for 7,000 and I have not depreciated the asset. How do I properly report the sale on my tax return?

ANSWER

Expert Thomas Graham iii's Answer:

To properly report the sale of this building you will need to file a IRS form Schedule D with your yearly 1040. This asset was held longer than one year so it would be classified as a long term. On Schedule D you will need to provide 1) Description of the Property 2) Date Acquired 3) Date Sold 4) Sales Price 5) Cost or other Basis 6) Gain (or loss).

More than likely your cost basis in the asset will be the Fair Market Value of the asset as of the date of the death of the person you inherited the asset from. It is also possible that it could be the FMV at the Alternative Valuation Date but more than likely it is the former. You will then assess your gain or loss based on this information.

Thomas Graham iii, CPA, CFE

Oklahoma

7 yrs experience

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