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Selling commerical building property in FL, possible tax consequences

Asked over 3 years ago - Orlando, FL

because of the rough economy i have had to sell my property which has a small ware house on it in Florida.
I have a granite shop business that i conduct from there. Now i am looking to rent.
The closing will be in 2 weeks.
My question is, what is the process that involves with the irs and what i could do to maximize my profits from selling the property. Also is there anything that i could do to avoid paying so many taxes?

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Attorney answers (2)

Bruce Givner

Reputation Level 12

Answered over 3 years ago. Tax Lawyer in Los Angeles, CA.

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Do you prepare your own tax returns? You need to hire a competent CPA. Get a recommendation from a friend, neighbor or relative. Or call the Florida CPA Society at (850) 224-2727 or (800) 342-3197 and they will direct you to the nearest local chapter.

The "process" with the IRS is that you report on Schedule D of your return the gross price you receive for the property, minus permissible selling expenses, and then subtract from that your "basis" in the property. Multiple the balance by the applicable Federal tax rate. I can not advise you on the applicable Federal tax rate because it depends upon the rest of your taxable income for the year and possible other factors.

In conclusion, do not attempt to rely on advice over the internet. Get yourself to a competent CPA now.

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Richard H. Breit

Reputation Level 6

Answered over 3 years ago. Business Attorney in Fort Lauderdale, FL.

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You might be able to reduce your tax a little by using a 1031 exchange but that assumes you will be buying something else in the next year or so. As far as maximizing profits and reducing taxes, the gross sales price of the transactiohn will be reported to the IRS by the closing agent. The best thing you can do is make sure you ahve a good tax preparer and that you give him or her all of the information they may need to get you all the deductions that are available to you.

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