Agent

Widow seeks tax break on land sale

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DEAR BOB: Over 18 months ago, my husband and I bought two acres for $44,900. Our plan was to build our home on this land and sell our primary residence. But my husband recently died. Because I had no intention of building a new home without my husband, I sold the land for $138,200 net. Now I am in the process of refinancing my primary residence to make the mortgage payments more manageable. I will pay $92,000 at the loan closing to bring my mortgage balance down. Will I have to pay capital gains tax? If so, how much? – Paula W. DEAR PAULA: Please don't do anything until you consult your personal tax adviser about the capital gains tax on your very profitable land sale. Purchase Bob Bruss reports online. Depending on how title to that land was held, you received a partial or full new "stepped-up basis" to market value on the date of your husband's death. That stepped-up basis will greatly reduce your capital gain tax on the land sale. Currently, the maximum federal capital gai...