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    malibugirl1978's Avatar
    malibugirl1978 Posts: 5, Reputation: 1
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    #1

    Mar 7, 2012, 02:04 PM
    Tax on sold inherited property
    I inherited my Dads house and I am selling it on a land contract. It is being sold lower then turned in to court house records. Do I turn in the interest being made on the house.Still in my name tntil paid for.
    malibugirl1978's Avatar
    malibugirl1978 Posts: 5, Reputation: 1
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    #2

    Mar 7, 2012, 03:11 PM
    Taxes owed on inherited home sold by land contract. Do I pay taxes on interest.
    I am selling a inherited home by land contract. Do I pay taxes on interest. No gain on value of house
    AK lawyer's Avatar
    AK lawyer Posts: 12,592, Reputation: 977
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    #3

    Mar 7, 2012, 05:36 PM
    Not until you have recovered all of your basis in the property.
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    malibugirl1978 Posts: 5, Reputation: 1
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    #4

    Mar 7, 2012, 10:32 PM
    Taxes on inherited home sold by land contract
    Thank you for your fast reply. Concerning your answer the total of the interest when home is paid for will still be below what I filed at court house. Does this still require me to pay tax on interest as you said when I get total amount. Thank you
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    malibugirl1978 Posts: 5, Reputation: 1
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    #5

    Mar 7, 2012, 10:49 PM
    Taxes on inherited home sold by land contract
    I am so sorry but I neglected to state this is concerning filing it on income tax
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
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    #6

    Mar 8, 2012, 04:21 AM
    First, the proper way to add to your questions is using the Answer options below, please don't start new questions. I've merged your threads for you.

    This depends on how you have worded your contract. Normally, in a land sales contract, the buyer is paying a monthly amount that is NOT considered principal and interest. So the payments are not income. However, if you sold using a promissory note, then the interest could be considered income for you.

    I strongly suggest you consult a tax professional for this year's return.
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    malibugirl1978 Posts: 5, Reputation: 1
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    #7

    Mar 8, 2012, 10:48 AM
    Thank You I'm sorry about the confusion.. Your answer helped me
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
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    #8

    Mar 8, 2012, 11:29 AM
    Actually looking at my answer I misspoke. The payments made ARE income, because they are contractual payments. Pretty much the same as rent.

    I'm not sure, and would suggest a tax pro to answer, what happens when the contract is completed and the property transferred.
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