Contributing 

Where do I report the sale of an investment property?

Leia Doyle

Where do I report the sale of an investment property?

Report the gain or loss on the sale of rental property on Form 4797, Sales of Business Property or on Form 8949, Sales and Other Dispositions of Capital Assets depending on the purpose of the rental activity.

Can you write off a loss on the sale of a rental property?

Converting a personal residence into rental property Losses from selling a personal residence are not deductible. Generally, you can only claim tax losses for sales of property used for business or investment purposes. However, a loss from a decline in value after conversion to a rental, is generally a deductible loss.

Can you claim cost of selling investment property?

If you sell your investment property, you are likely to be liable to pay capital gains tax (CGT). The ATO allows you to offset costs like stamp duty, any legal fees and estate agent’s commission to reduce your profit – and therefore your tax obligation.

How do you avoid capital gains tax when selling an investment property?

Are there ways to avoid capital gains tax?

  1. Hold on to any investment property for more than 12 months and you could receive a 50% discount on your capital gain.
  2. Keep detailed records of all your spending on the property from the day you purchase it, to potentially offset the gain down the track.

How do I avoid taxes when selling a rental property?

  1. Take advantage of being an owner-occupier. If you live in the property right after acquiring it, the asset can be listed as your Primary Place Of Residence (PPOR).
  2. Wait for one year.
  3. Get the property reassessed before renting it out.
  4. Use exemptions like the 6-year rule.
  5. Use an SMSF home loan.

What expenses are deductible when selling a rental property?

What Closing Costs Are Tax Deductible When Selling Rental Property?

  • Appraisal fees.
  • Inspections.
  • Loan origination fees.
  • Title fees.
  • Transfer fees.
  • Mortgage interest.
  • Mortgage points.
  • Real estate property taxes.

What can you claim when selling investment property?

Repairs and maintenance to your investment property. Management and maintenance costs, including strata fees, council rates, water rates, cleaning, gardening and pest control fees. Insurance for your investment property, including building, landlord and contents insurance. Interest on your mortgage and borrowing …

How much tax do I pay if I sell my investment property?

If you sell the property once you’ve retired, you’ll pay no capital gains on the property. Even if you sell the property while you’re still accumulating your super, this will be taxed at a rate of only 15%. Holding onto the property for longer than a year will effectively drop this rate to 10%.