Capital gains tax on what amount?

Question

Bought a house May05 if I sell now do I have to pay capital gains tax. and is this calculated on the difference of cost and selling price or the money left after all expenses ( broker, title,escrow)

I have no reason for exemption-relocation because of job etc

I just some one saying that if it is my first house and the gain is less than 250K I doo not have to pay any capital gain tax if if I have owned and lived in this house for just one year

Answer 1

You pay capital gains if you haven't lived in the house for 2 of the preceding 5 years. I believe it will be the difference between your cost basis ($$$ put into buying the house) and the amount you sell the home for. If you don't sell until May 07, you shouldn't have to pay any capital gains.

Answer 2

All fees and expenses, original cost, and any improvements, (verifiable), are deducted from the selling price.

There is no tax up to a maximum. Check with a tax accountant on that amount.

Answer 3

24 Months! You have to have lived in it for two years as primary residence to avoid capital gains....Don't sweat it....rent it out for a year or two then sell. If you sell w/in 5 yrs, you can avoid Capital Gains.

Answer 4

if it's your first house (and you're primary residence) it's tax-free gain anyway up to a certain amount, I believe...