In residential sales in southern california, if you keep the house for 2 years, there's no capital gains. Does same apply for business such as liquor stores? If you keep it for 2 years, no capital gains?
2007-07-01 04:44:10 · 6 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
Section 121 of the federal tax code allow you to now pay taxes up to $500,000 of capital gain on the sale of a primary residence when you have lived and owned your primary residence for two of the last five years.
Business's can defer gains based upon a 1031 exchange. Check with you tax counsel if you are going to buy another liquor store to defer the gain. You tax counsel may be able to refer you to a qualified intermediary for the exchange. There is a national association, The Federation of Exchange Accomodators located at www.1031.org which may be able to help you in your search.
2007-07-02 11:48:47 · answer #1 · answered by William H 5 · 0⤊ 1⤋
No, the exclusion only applies to your principal residence if you lived in it for 2 of the 5 years prior to the sale and have not claimed the exclusion within 2 years of the date of sale.
Residential real estate held for investment purposes and commercial real estate are treated the same for CG purposes. Capital gains are fully taxable.
The sale of a business is extremely complex from an accounting and tax perspective. Professional assistance is clearly warranted as mistakes can be seriously damaging to your wealth!
2007-07-01 07:35:28 · answer #2 · answered by Bostonian In MO 7 · 0⤊ 0⤋
No, you still have to pay capital gains on commercial property or rental property.
2007-07-01 05:08:03 · answer #3 · answered by Judy 7 · 0⤊ 0⤋
for business, capital gains applies always no matter the time.
2007-07-02 09:48:15 · answer #4 · answered by James 2 · 0⤊ 1⤋
As listed by Herrmann, they each have their own distinctive usages. Taxes can be very interesting. You should learn more about them. Knowledge is power.
2016-05-20 01:53:23 · answer #5 · answered by ? 3 · 0⤊ 0⤋
No. It only applies to main residences.
2007-07-01 05:05:34 · answer #6 · answered by Wayne Z 7 · 1⤊ 0⤋