Catherine Posted March 15 Report Share Posted March 15 Client sold property in Colorado, part of an association. He tells me that the HOA dues and assessments for the entire time he owned the place are additions to his basis, and that the CO realtor told him this is what is done in CO. Sounds suspicious, at best, to me. I can see assessments being added to basis (association roads, roofs, etc), but not standard HOA fees for mowing and plowing and general maintenance. Can't find anything in Colorado rules about this. Anyone here have advice? Quote Link to comment Share on other sites More sharing options...
Lion EA Posted March 15 Report Share Posted March 15 I agree with you. Assessments probably. HOA fees, no. I have a few clients in CO, but no one in a condo, so I haven't researched this issue. However, CO does follow the feds. Don't you love realtors who give tax advice?! 2 Quote Link to comment Share on other sites More sharing options...
Catherine Posted March 15 Author Report Share Posted March 15 6 minutes ago, Lion EA said: Don't you love realtors who give tax advice?! Some of my favorite people, yeah - not. They were probably thinking about the CO capital gains exclusion for farmland bought before 2009 - but that's (a) only CO, and (b) only for those filing Schedule F with their 1040. 4 Quote Link to comment Share on other sites More sharing options...
mwrightea Posted March 19 Report Share Posted March 19 Sadly, we have a lot of realtors in Colorado that think they are tax experts when selling a property. Colorado will assess penalty for not withholding and submitting taxes at time of sale if your client is a nonresident and transaction is taxable in Colorado. I'm betting the realtor didn't tell your client that little nugget. The Colorado capital gain exclusion is not something that most realtors are familiar with. Assessments for improvements are added to basis. HOA expenditures are not added to basis we follow must federal rules. 3 Quote Link to comment Share on other sites More sharing options...
Catherine Posted March 20 Author Report Share Posted March 20 Thank you, @mwrightea - that's (mainly) what I told the client. I've added in to the basis the assessments that were tagged with comments such as "Assessment - road improvements" plus a couple of selling fees. Thank you. No, they most certainly did *not* tell him about penalties for not withholding taxes - and of course, none were withheld. They're going to have a tidy little bill from Colorado. 1 Quote Link to comment Share on other sites More sharing options...
mwrightea Posted March 20 Report Share Posted March 20 Catherine, you are welcome. The title company should have had your client file a CO DR 1083 if they are a non resident. I appreciate all the help I have received over the years from you and this board. 3 Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.