October 4, 2007
Avoiding Gapital Gains Tax on the Sale of Your Home
Worried about taxes eating away too much of the profit on your home? Under a law enacted about ten years ago, a married couple filing jointly usually can exclude as much as $500,000 of their gain. For someone who is single or married and filing separately, the limit is $250,000.To qualify for the full exclusion, you typically must have owned the home and lived in it as your primary residence for at least two of the five years prior to sale.
This exclusion applies only to your primary residence. Even someone who couldn't pass those tests might qualify to exclude most or all of the gain under certain circumstances. The seller may be eligible for a reduced exclusion if that person had to sell because of a "change in place of employment", health reasons or "unforeseen circumstances." What are unforeseen circumstances? Examples cited by the Internal Revenue Service include divorce, death, or "multiple births resulting from the same pregnancy."
Some think they're required to buy a new home to qualify for this home-sale gain exclusion. That's wrong. They're probably thinking about a law that was repealed about a decade ago, under which you could defer tax on the gain on the sale of your home by rolling over the proceeds into a new home that cost as much as, or more than, the old one. Congress eliminated that law, in part because it was viewed as unfair to people who wanted to downsize and buy a less expensive home or to sell and move into a rental. Contact Patrick Warholic, your Folsom, El Dorado Hills, and Granite Bay Realtor for details.
Folsom Luxury Homes and Land Specialist
Our motto is to always "Do the Right Thing", starting with providing premier executive real estate service to buyers and sellers of Folsom, Granite Bay, and El Dorado Hills luxury homes and land.
For more information from California Home Network visit Patrick Warholic, The Internet Home Marketing Specialist for free, no registration required, MLS home and property searches with amazing home search results at your fingertips, along with its ease of use, no registration required advanced home search features that will simply astound you. You can even search by using the new Google Map search, with community search parameters, and even do a home search for energy saving features too. Are you looking for great real estate deals, short sales, or bank owned properties? With this powerful home search engine that information is right at your fingertips now.
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Labels: Homes, Informational, Properties, Real_Estate, Taxes, Tips
posted by Patrick Warholic @ 8:56 PM
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