after you build a house in florida you have to hold on to it for 2 years or pay 15% tax. is that still current

Question

i heared that now you have to keep the new construction for 3 years, i really have no clue as to how to find out the laws an someone please answer my question and if possible provide link, thank you so much.

Answer 1

There are two tests for excluding $250,000 per person of capital gain on the sale of a primary residence.

To claim the exclusion, you must meet the ownership and use tests. This means that during the 5-year period ending on the date of the sale, you must have:

Owned the home for at least 2 years (the ownership test), and

Lived in the home as your main home for at least 2 years (the use test).

If you pass both of those tests, you can deduct $250,000 ($500,000 if married) from the gain on the sale of the house. If not, the gain is taxed at capital gains rate (if it's held for more than 1 year, then the maximum rate would be 15%).

I hope that helps.

Answer 2

If you own the house for 1 year or less, it's ordinary tax rates.

If you own the house as a capital asset for more than 1 year and less than 2, it's 15%.

If you own the house for more than 2 of the last 5 years, lived in it for more than 2 of the last 5 years and haven't excluded the gain on another sale in the past 2 years, then generally the $250K exclusion applies...UNLESS you acquired the property in a like-kind exchange (then you have to wait 5 years).

There was talk (only as far as the House) to change the exclusion rule if you'd held the property first as a second home and them moved into it as your primary residence.

Answer 3

There isn't any 3 year rule on new construction, it has the same 2 year rules as existing homes.

If you don't qualify to exclude the gain, it's subject to capital gains tax of either 5% or 15% depending on your tax bracket. If your bracket, including the house profit, is over 15%, the c.g. tax is 15%, if it's less, is 5%.