I live in Fl. I recently sold something for $23,000.00, approximately how much will I have to pay in taxes?

Question

not married, no children, income 25,000

I did not buy it.... I acquired it several years ago. It appreciated in value.

it was a gift several years ago ...it appreciated

Answer 1

Selling a gifted item is a bit confusing. I have a link attached. What you need to know is the giver's basis in the item AND it's fair market value (FMV) when it was given to you. If, hopefully, the FMV is greater than the giver's basis, then things are easy. If the FMV is less, it gets a bit more complex. Let's assume the FMV is greater. If so, you need to calculate your basis. Your basis is the giver's basis plus whatever you put into it plus any selling costs. The difference between the selling price and your basis is considered capital gain (assuming the item is a capital item). The tax rate on the gain depends on what the item is.

Example: Someone pays $5,000 for a classic car. They pay $2,000 to fix it up. They give it to you. The car was worth $9,000 when they gave it to you. The FMV for the car ($9,000) is greater than the giver's basis ($7,000). Your basis is now $7,000. You invest another $3,000 into the car and pay $500 in selling costs. You sell the car for $23,000. Your basis is 7,000+3,000+500 = $10,500. The gain is 23,000 - 10,500 = 12,500. This is long term gain if you held the car for more than one year and short term gain if held for less than one year.

There can be more to the story. For example, if the giver paid gift tax then some or all of it can be added to your basis depending on when they gave it to you. Look at the attached link for official IRS guidelines and good luck!

Answer 2

Your details are sparse but here goes. You need the date you acquired "whatever" and the basis you have in it. If you put any money into improvements, repairs, enhancement, yaddah then you have increased your basis. In any case if you possessed it for over one year any gain will be long term; and in your income bracket long term capital gain tax will only be 5%. Example follows using 2005 setup: 25,000 income less standard deduction of 5,000 and one exemption of 3,200 leaves you with 16,800 of taxable income plus (assuming no basis but all gain) 23,000 gives you 39,800 gross taxable income. Tax in 2005 would have been 2999.00. Slightly less in 2006.

Answer 3

Any answer you get without a definition of what the item is could be flawed. "Acquired it" could have several meanings, some of which are covered by others. You seem to be reluctant to be clear on this issue which would lead one to suspect that was not inheritance or a gift. Without being clear that answer could also be flawed.

Answer 4

I agree with Skip, just want to add another point. The rates he is talking about are Federal rates. The State of FL does not have income taxes, therefore ZERO to the State.

Answer 5

You haven't said how much you bought it for, how long you hold it and what it was. the tax rates are either 5%, 15% or 28% on the gain. The gain is, in simple terms, what you sold it for minus expenses of sale minus purchase price minus costs of purchase minus anything you paid to enhance its value.

Edit: If you acquired it without buying it, it was either by gift or inheritance. By inheritance, your cost basis is value at date of death (as a general rule) plus any enhancement costs you added. If you received it as a gift, you will stand in the donor's shoes in terms of cost basis.

Answer 6

Taxman is correct. If you absolutely can't determine your tax basis, you could assume your basis is zero. The IRS won't complain about overpaying taxes.

Answer 7

for missouri and making 23.000.00 for the year I payed in $2.500 on federal filing exempt on medical how much will I get back