Tax write off for huge loss on home sale ?

Jdiding

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Ok folks have a question for you guys that know how all this stuff works
In 2013 I bought a home. Paid 145k cash fast forward to fall of 2016 I had a renter moved in. My and ex wife had to divorce. Wife got 40k from house
Had to sell the place since I sure didn't have 40k to give her
Renter had all but trashed the property the house and the garage. As I was up against a fence and facing the judge wanting to put a warrant out if I did not pay my ex wife by the set date.
I took a massive. Like nearly 80k loss on the house due to the damage and the need to sell it quickly to avoid more legal issues
It's a long ass story with lots of legal issues between me my Renter and my ex wife


What I need to know.
I was told I may be able to get some kind of tax refund for a huge capital loss
Is that true in any way ?
Even if it's a percentage of what I lost I'd be happy since I basically hit the reset button on life and walked away with nothing from the house at all aside from no legal issues and a satisfied judge.
 

blakbearddelite

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Why would she get anything if there weren't going to be proceeds from the sale?!?
 

blakbearddelite

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I don't get how she walks away with equity when you're upside down on the house.
 

Jdiding

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She managed to get the judge to approve her getting 40k from the house. Witch basically left me with nothing left. Like I said I got 100% Fucked over on the deal and had quite possibly the dumbest lawyer on earth and she had a really good lawyer
 

Jdiding

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It was paid for I cash when I bought it I agreed to the 40k in lieu of child support payments till my kids were 18. That was her ideal also when I told her no way was I giving her 40k and making 380 a month support payments.
That's not my question tho I need to know if there is any type of capital gains loss tax provisions that I may be able to recoupe even a couple grand on
 

1quick

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I would talk to an accountant but yeah you should be able to write off what you lost
 

blakbearddelite

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I'm almost positive you can't deduct the loss unless it was an investment property and not a primary residence.
 

blakbearddelite

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It's the same reason you don't have to pay taxes if you make money on the sale of your primary residence.
 

blakbearddelite

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It was paid for I cash when I bought it I agreed to the 40k in lieu of child support payments till my kids were 18. That was her ideal also when I told her no way was I giving her 40k and making 380 a month support payments.
That's not my question tho I need to know if there is any type of capital gains loss tax provisions that I may be able to recoupe even a couple grand on
Ah, didn't have the whole picture. I can see why she was awarded the $40k.
 

Yaj Yak

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yeah get a really really good accountant here.
 

Ryan02Stang

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You can deduct the loss beginning with the value the day it became an investment property, when you began renting it. So if you rented it for 11 months and then sold it, you can deduct those 11 months of depreciation. Try to find comps around the starting point, and subtract what you sold it for.

Get a good accountant.
 

Flyn

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I know I have a habit of saying "ask an expert" but that's because it's the best answer when laws and large sums of money can be involved.

So, ask an expert, in this case an accountant would be cheaper than an attorney to determine the tax liability/benefits for your particular case.

My non expert guess is that you will be able to write off a portion of the loss each year but I don't know how long you can continue to do so.
 

Jdiding

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the way I look at it if I can get a grand or 2 back im happy
its a shitty situation all around and I lost my balls on it I paid 145k cash for it when I closed I had to borrow 40 bucks to cover gas to get home from Indiana I literally walked away with 0 dollars from it
 

Jdiding

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Not much over that by the time I paid off some stuff owed in Indiana that had to be covered out of the proceeds
 

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