2007-12-15 01:30:46 · 7 answers · asked by Lisa b 1 in Business & Finance ➔ Taxes ➔ United States
If you owned it for two years out of the last five, and lived in it as your main home for two years out of the last five, you can exclude upto $250,000 of gain on your return, $500,000 if you are married filing a joint return. So if your profit (NOT your sale price) was more than that, you'd pay tax on the amount that's over, otherwise no. If you can exclude the entire gain, you don't have to report the sale on your tax return.
2007-12-15 01:40:57 · answer #1 · answered by Judy 7 · 3⤊ 0⤋
It's a question of capital gains. After you've had your home as your primary residence for 2 or more years of the last 5 years, then you as a single person can have $250K PROFIT or $500K for a couple (filing jointly), that is not taxable.
There is an article here that explains this:
http://www.smartmoney.com/taxmatters/index.cfm?story=20030108
It used to be that you had to buy another house very soon, typically for more, to avoid taxes. It appears all of that has changed. I'd double check the rules in the tax forms when they bring you good cheer at the start of the New Year or on TurboTax or whatever you use or your tax guy if that's how you do it. I also have no idea what your STATE will say as they always have their hand out too.
2007-12-15 01:38:26 · answer #2 · answered by heyteach 6 · 0⤊ 0⤋
The capital gains tax can be defered if you buy a house within a two year period. Otherwise the tax is calculated by taking the purchase price and the selling price and taxing the difference. Doesn't matter to the IRS if you had a balance owing on the mortgage or not. But yes, you will pay either way, for a new house or the CGTax.
2007-12-15 01:39:31 · answer #3 · answered by aylatroy 4 · 0⤊ 4⤋
No, if you are single had lived in the house two out of five years then up to $250,000 is excludable. If you were married and your and spouse would be entitledto up to $500,000.
2007-12-15 04:04:03 · answer #4 · answered by Gary 5 · 0⤊ 0⤋
Not unless your gain is over the allowed maximum, tax free.
2007-12-15 01:39:00 · answer #5 · answered by ed 7 · 0⤊ 1⤋
If you are a single individual, the first $250,000.00 in profit is exempt from taxation. If you file as "Married filing Jointly", then the first $500,000.00 is exempt from taxation.
2007-12-15 01:39:17 · answer #6 · answered by RUSerious 7 · 0⤊ 0⤋
I don't think you have to pay capital gains tax on it...
But, I don't know about anyother tax, like sales tax and etc...
2007-12-15 01:37:07 · answer #7 · answered by Nathan 2 · 0⤊ 6⤋