Well it is tax season and I thought it would be a good time to talk about selling houses.Â The law changed about ten (10) years ago and you no longer roll the profit from previous homes.
A few rules to follow to exclude $250,000 of gain as a single person and $500,000 married filing jointly.
1.Â During the (5) year period ending on the date of sale, you must have owned the home for a least 2 years.
2.Â During that same five year period, you must have lived in the home as your main residence for at least two (2) years.
3.Â If you must sell your home for any unforeseen reason, health issues or you are transferred out of area will still be entitled to a partial credit.
To determine the amount of your gain, start with the total purchase price of your home including closing costs and add any major improvements that you made to your home -- not cosmetic, like new paint and carpet but improvements, new concrete, upgrading the furnace or roof, room additions, etc. -- and subtract from the net selling price of the house.Â The net selling price is the price less any closing costs you have to pay.
My information came from my CPAÂ SSC Services, Inc, 2190 NW 82nd St., Suite 4, Clive, IA 50325Â Â http://www.sscservices.com
Pat Baker, Realtor(R), ABR (R), GREEN(R)
Coldwell Banker Residential Brokerage
1 Chapel Street, Needham, MA 02492
(C) 671-435-3471 (O) 781-444-7400 (V&F) 781-446-8697
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