Publication 225 |
2000 Tax Year |
Sale of a Farm
If you sell your farm, you cannot adjust the basis of the land at
the time of the sale for any unused carryover of soil and water
conservation expenses (except for deductions of assessments for
depreciable property, discussed earlier). However, if you acquire
another farm and return to the business of farming, you can start
taking deductions again for the unused carryovers.
Gain on disposition of farm land.
If you held the land 5 years or less before you sold or disposed of
it, gain on the sale or other disposition of the land is treated as
ordinary income up to the amount you previously deducted for soil and
water conservation expenses. If you held the land less than 10 but
more than 5 years, the gain is treated as ordinary income up to a
specified percentage of the previous deductions. See Section 1252
property in chapter 11.
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