What is the tax law for the keeping the tax basis of my house if I sell it after I turn 55 and buy another one

Answer 1

The law changed a couple years back. The old law allowed a one-time exemption from tax on a house sale, but you had to be over a certain age, I think 65. If you were younger than that, you could roll the gain from one house into another one and defer the tax if you bought it within a year.

With the new law, there isn't an age limit, and you don't have to buy another house, and you are forgiven the tax, it's not just deferred. There are certain rules - you have to have owned the house for two of the five years prior to sale, and have lived in it as your main home for two of the five years prior to sale. There are a few other rules - as long as you meet them, you can exclude up to $250,000 of your gain from taxes, $500,000 if you're married filing joint.

Answer 2

I am not sure what you mean by "keeping the tax basis" , but you do not have to report the gain from the sale of a principal residence anymore, if your GAIN is under $250K and you are single or $500K if you are married. As long as it was your principal residence 2 of the last 5 years. The over 55 rule was done away with in 1997. I hope this helps.

Answer 3

Judy is right and also keep in mind while technically there's no limit on the number of homes you can sell and reap tax-free gain, each sale must be at least two years apart. That still leaves you room to make some money on several properties. You can sell your residence this year, pocket any gain within the tax limits and buy a new residence. Two years later, you can do the same thing, again and again every two years.

Answer 4

Your question is unclear but here are some basic facts. If you are single and sell your main home that you have resided in for two years you can make a profit of $ 250,000.00 and owe no tax whatsoever-zip-zero-nada-squat-zilch-yaddah. Buying another one or not makes no difference.

Answer 5

You are thinking of the old law that went away in 1997.