Sold inherited property at a loss? Check how to report capital loss in ITR-2 and save future tax

Selling inherited property at a loss requires correct reporting in ITR-2 to claim future tax benefits.

Under Section 49(1) of the Income Tax Act, 1961, the cost of acquisition for inherited property is the cost at which the previous owner acquired it.

Capital losses can be carried forward for up to eight assessment years if the return is filed by the due date under Section 139(1).

Short-term capital losses can be set off against both short-term and long-term capital gains, while long-term capital losses can only be set off against long-term capital gains.

Documentation and correct calculation of capital loss are necessary to stay compliant under the Income Tax Act and save future tax.