Substantial Improvement
Substantial Improvement is used.
with respect to the subdivision of lots, an improvement is “substantial” if it results in more than a 10% increase in the value of a lot. Filling, draining, leveling, and clearing land are not considered substantial improvements. Substantially improved land does not qualify for capital gain treatment. Former IRC (check if this IRC provision is current here) §1237.
See also Capital Gain in the American Legal Encyclopedia and Capital Gain in the World Legal Encyclopedia.
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