I would like to sell a second home, and purchase another second home (like-kind purchase), thereby not having to pay capital gains tax. It is possible I may need to sell my primary residence, take the $500,000 exemption for my wife and I, and possibly move into the newly purchased second home, making it our primary residence. Should there be a window of time in between doing this if we have to move and can't afford two homes? Is this legal? Can it happen? Any help would be greatly appreciated.
2006-10-03 18:13:14 · 4 answers · asked by gvlflyguy 1 in Business & Finance ➔ Renting & Real Estate
Consult a real estate attorney or a good accountant familiar with real estate tax laws, otherwise you are going to mess yourself up in this transaction..
2006-10-03 18:17:46 · answer #1 · answered by MeInUSA 5 · 0⤊ 0⤋
Hai, to avoid paying of capital gain tax you have to buy another assest before 6 months period. If you are not willing to do this, you can invest that amount in NHAI (National Highway Authority of India) or REC (Rural Electrification Corporation) Bonds. But these bonds will give minimum interest. If you have specific idea on deploy money for good plums, pay capital gain tax and park your money elsewhere, where you can get good returns which beats inflation.
2006-10-03 18:34:26 · answer #2 · answered by chindu 2 · 0⤊ 0⤋
Yes you can .. sell the second home - it's called 1031 Exchange..
but you can't take any of the money out of whatever profit you made on that second home, you have to use them all to purchase the other home (like kind)
call a 1031 Exchange company or google it..
2006-10-03 18:25:31 · answer #3 · answered by Anonymous · 1⤊ 0⤋
Just talk to your tax preparer.
2006-10-03 19:00:09 · answer #4 · answered by LasVegasMomma 4 · 0⤊ 0⤋