before you have to pay capital gains tax on it.?
Also, does it matter how long you owned the property?
I tried looking this information up at the I.R.S. site, and couldn't find any helpful info.
2007-03-18 04:31:09 · 5 answers · asked by Kismitt 6 in Business & Finance ➔ Taxes ➔ United States
If you have a taxable gain on the sale of a home you must pay any tax due in the year that you sold the home. There is no deferral period for capital gains taxes from the sale of a home.
If you lived in the home as your principal residence for at least 2 of the 5 years immediately prior to the sale you may be eligible to exclude all or part of the gain from capital gains tax. The exclusion amount is $250,000 for a single taxpayer and $500,000 for a married couple filing a joint return.
If you're not eligible for the exclusion or if you have any gain that exceeds the exclusion amount, taxes are due and payable in the year of the sale. If you owned the home for one year or less, the gain is taxed as ordinary income. If you owned it for more than one year, the gain is treated as a long term capital gain and is taxed at a lower rate, normally 15%.
No clue who is throwing the thumbs down on this one but it is a correct answer. If you think I'm wrong, please contact me and we can discuss it.
2007-03-18 04:44:44 · answer #1 · answered by Bostonian In MO 7 · 3⤊ 1⤋
Your gain goes on your tax return for the year of the sale, when you file it the following year. Technically, if you have a significant gain and expect to owe much in taxes, you should file a quarterly estimated return at the end of the quarter when the sale was made.
No, the timing of the taxes is not related to how long you owned the property.
2007-03-18 14:07:43 · answer #2 · answered by Judy 7 · 2⤊ 0⤋
You pay the tax for the year property is sold. If it was sold Dec. 31 of 2005 you pay tax on 2005 tax return.
If held longer than a year, as in a year and a day, rates are figured as long term capital gain. I held less than a year rates are short term capital gain. (higher tax rate)
Sale of property is reported on Schedule D.
2007-03-18 11:45:02 · answer #3 · answered by Jo Blo 6 · 1⤊ 1⤋
Capital gains tax is based on the amount of money you have earned from the sale of the house (i.e. profit).
I believe it is due the year after the sale of the property.
2007-03-18 11:35:06 · answer #4 · answered by lremmell64 4 · 1⤊ 2⤋
1031 after 2 years
2007-03-18 11:43:30 · answer #5 · answered by Anonymous · 1⤊ 2⤋