TCMonta...[at]gmail.com wrote:

- quote -

First, you need a separate valuation of the house and the
land at the time of purchase. Subtract the house "cost
basis" from the purchase price to get the value of the land.
4L = 105k - H

Divide land value (4L) by 4 to arrive at a "per acre" basis
(L). This assumes equal value for all sections of land,
which may be erroneous. Other methods may be used, depending
on circumstances or features of each parcel (suitability for
building, access, water, etc).

Determine value of parcel sold, 1.5L

Gain = 70k - (1.5L)

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TCMontanye[at]gmail.com wrote:

- quote -

Go back in time to original purchase and determine separate
costs of house and the 4 acres of land. Unless something
happened to increase the basis of the acreage, you've got
your cost per acre.

ChEAr$,
Harlan Lunsford, EA n LA

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Can anyone tell me how the taxable profit is determined when
a parcel is sold that was subdivided from a larger lot with
a house on it?

Original price of house and 4 acreas of land - $105k

1.5 acre parcel sold for $70k

Thanks in advance

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >