Hi all, this is my first time posting…but LONG time CH listener.
My parents sold their house last year and moved to senior apartments. They are afraid to do their taxes because they lost pretty much all of their home imporvemnt (and other) receipts due to water flooding their basement.
Since they built the house themselves and with some contractors back in '86-'87, they are missing a ton of records about the value of the house now and aren’t sure what they can do about capital gains. The house sold for about $750K.
I know they can try to get some corroboration from past contractors, maybe, possibly from neighbors, photos, etc. BUT that will be so darn tough and very incomplete.35 years ago is a loooong time to try and get records. Most companies aren’t in business anymore.
Good news: $500,000 of profit is excluded from capital gains taxes anyway. If it were me, and I was pretty sure my basis was more than $250,000, I’d just go ahead with that, paying no capital gains. It’s not like they have to show the IRS receipts to file the tax return.