Bill Brown <brownwp[at]longwood.edu> wrote:
- quote -

They should have rented it to her/him at FMV.

Dick

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"Dick Adams" <rdadams[at]panix.com> wrote in message
news:gmidbf$kdd$1[at]reader1.panix.com...
- quote -

Technically true, but as it's 7 months after death, a 1 month difference, I
think the IRS would be hard pressed to find a reason to ignore it
completely should the matter go to the Tax Court. It's more likely that
they would find the ENTIRE loss as personal and disallow it from all three
beneficiaries. Remember that personal use by a family member can be
considered personal use by one's self. They are related people per IRC
267(c)(4) (definition of "family" which applies also to IRC 262).

- quote -

It can be expensive before the fact too. ;-)

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On Feb 6, 3:40*pm, John <tx3...[at]yahoo.com> wrote:
- quote -

Personal use includes allowing a related party to use the property at
below-market rent. All the sibs, therefore, made personal use of the
home. None of the sibs can deduct a loss.

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ed <edcos...[at]sbcglobal.net> wrote:
- quote -

The other two have a loss if they can produce evidence that
the FMV at the time of death was more than the sale price.
A smidgen of tax planning could have made a difference for
all involved.

But my question is "How long does someone living in a property
have to move out before they lose the deduction for loss on sale?"

Dick

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On Feb 6, 4:24*pm, rdad...[at]panix.com (Dick Adams) wrote:
- quote -

I should think almost 2 years with a relative living in it free
should pretty well establish it as a personal residence rather than
rental or investment.

ed

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ed <edcosoft[at]sbcglobal.net> wrote:
- quote -

If, by "another tax forum", you are referring to the "funny farm",
we all know its value.

- quote -

The loss on a personal residence is obviously not deductible.
But this was an inheritance and it is similar to the loss on
securities.

The 2007 appraisal was not within six months of death. Thus, it
would not be unreasonable for it to be tossed out upon audit.
OTOH home values have decreased sharply over the last two years.
It should not be difficult to get written opinions of other
appraisers as to the Nov. 2007 value.

Once again we have an example of how expensive tax planning
after-the-fact can be.

Dick

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On Feb 6, 2:40*pm, John <tx3...[at]yahoo.com> wrote:
- quote -

residence cannot produce a tax deductible loss. I would also be
suspect of a Jly 2007 apreisal

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these circumstances -

Mother passed away in Nov. 2006 Her house was left to three
surviving adult children. One child lived in the house until it was
sold in 2008 for $200,000. No appraisal done at death but in June,
2007 an appraisal was done and the value was $300,000. Can the
$100,000 difference between sale amount and appraisal be deducted as a
capital loss ?

One answer from a tax professional was yes, it is deductible on Sch. D
for the two surviving children that did not live in the house (limit
$3000 yr)

this question was on another tax forum and it's not my exact personal
situation but I am interested in other opinions if this is a
deductible "loss"

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