All Forum Posts by: Rami Santrisi

Simple answer might be: consult CPA / get one. I'm trying to see if there's a rule of thumb of sorts.

I recently rehabbed a home late last year, and spent a lot of money doing it (it exceeds my income from my normal job). We are selling the home now.

So my question is how do I put this on my taxes? Do I take a loss (it is my only property last year) on last year's taxes equal to the cost (purchase + rehab) of the home, and then when I sell this year, that would be income? Or is there another method?

Issues are: if I put the loss this year, i'd be in the negative (normal job income minus rehab) and wouldn't fully benefit from the deduction. Come next year, I would have the sale plus income, which will probably put me in a different bracket thus doesn't seem good. This is especially concerning since the investment is so large in this home but we don't anticipate making much of a profit on it (due to various issues). Thoughts?