Article Date:
February 2006


Word Count:
195

 

 

Proving Basis in the Home


Riley and Joyce Pendergraph held title to their Gilroy, California, home in the NHuss Trust. The trust sold the home and claimed no taxable gain because of $286,070 in improvements to the home. During its audit, the IRS found only $56,284 in improvements to the home since its 1972 purchase. The court upped that amount to $82,039, creating $101,907 in taxable capital gains.

 

Since improvements add to basis and reduce taxable capital gains, keeping track of improvements is important. That’s ... Log in to view full article.

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