Can I recoup on a lifetime tenancy by-out? An expense of some sort?

I just sold a house that my ex-husband, thru my generosity, had a life-tenancy in. I paid him $30,000 to quit claim. I ended up realizing $29,000 profit on the place before taxes. Is there a way to deduct anything like this, or am I just out the $30,000 like a HUGE bill? He won't even pay taxes on it I'm sure. Is there a way to make him pay taxes on his share?

1 Answer

Relevance
  • Nusha
    Lv 5
    1 decade ago
    Favorite Answer

    If you only bought him out of his interest it just increases your basis. So when you sold it, your cost (original plus the additional payment to him) is subtracted from the selling price. That would be your gain.

    So if you bot the house for 100k and paid him 30k then sold it for 130k then there would be no gain.

    If this is a personal residence in which you lived in for 2 of the last five year then you can exclude the gain.

    There is probably no way to make him pay part since he didn't force you to sell.

Still have questions? Get your answers by asking now.