We sold the REIT at a loss of about $50,000 from our orinigal investment of $100,000. Can anyone tell us how to report this to IRS for tax purposes. What bases do we use for reporting?
2007-02-11 06:57:52 · 2 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
Schedule D Form 1040. Depending on how long it was held as to whether it is short term or long term. Report Cost of $100,000 and proceeds of $50,000. Capital losses are limited to $3,000 per year---balance is carried over to subsequent years OR can be used to offset capital gains.
2007-02-11 07:07:34 · answer #1 · answered by beached42 4 · 0⤊ 0⤋
Schedule D. One warning about REIT's - they usually pay a return of capital dividend which decreases your basis. So let's say you bought it for $100,000 but received a $5,000 return of capital distribution your basis is $95,000. Your 1099-DIV's you've received while owning the stock will show the return of capital distribution.
2007-02-11 12:08:34 · answer #2 · answered by Melissa O 2 · 0⤊ 0⤋