I am probably going to be selling my house this year. This has been my primary residence for the past 2.5 years. It will probably sell for around $20k more than I paid for it. I see that the maximum investment income is around $2,800 or less to still qualify for the EIC. I beleive the sale of my home would be considered capital gains and would be included in investement income.
However I know that there are other tax laws that come into play since I've been in my home for 2 of the past 5 years and may not have to pay capital gains on it. Does it make it somehow exempt from being counted as interest income for EIC eligibility?
Please only respond if you really do know what you're talking about! Thanks in advancd!
2007-03-26 12:56:47 · 4 answers · asked by nazenail 2 in Business & Finance ➔ Taxes ➔ United States
My question refers to EIC eligibility for 2007, not 2006. So the sale of my home will be in 07, and I want to know if that will disqualify me from the EIC that would be recieved at the end of 07/begining of 08.
2007-03-26 13:20:21 · update #1
Since you lived in the home as your primary residence for over two of the last five years, and I assumed owned it that same time, your gain on the house sale won't be taxable, and won't have to be reported on your tax form since the gain will be well under the amount you can exclude. So the sale of your home shouldn't affect your eligibility for EIC.
2007-03-26 14:11:51 · answer #1 · answered by Judy 7 · 1⤊ 1⤋
First as of right now the EIC you would receive at the end of 2007 would not be effected by the sale of the home. I will repeat that this is as of right now. That could change at the whim of Congress.
Second Capital Gains are never counted as Interest income. The only time you have interest income is from depositing monies in a bank or other financial institution.
2007-03-26 13:11:25 · answer #2 · answered by mikeae 6 · 1⤊ 0⤋
The taxes you do this year by april 15 are for last year--no house sale. Your house sale will be claimed on the same years taxes, i.e, 2008 is when you will have to deal with the house sale.
2007-03-26 13:06:46 · answer #3 · answered by lilabner 6 · 0⤊ 0⤋
No,you won't. And EIC has nothing to do with a house. It depends on how much money you made in 2006. The exact amount will be listed in your 1040 booklet. Also depends on how many people are in your household. I'd say if you made over $12,000, you don't qualify for the EIC.
2007-03-26 13:09:03 · answer #4 · answered by Kaori 5 · 0⤊ 3⤋