Capital Gains tax.....
We are currently in the process of selling our home (we have owned it for 12 years) which should give us a net profit of around $155k. We were planning on purchasing a new home but another option has come up for us.
I currently take part-time care of my semi-disabled grandmother and she would really like us to move in with her and be her full-time caregivers, which is do-able for us. The problem is that we do not want to pay capital gains tax on the $$ from our home sale and want to reinvest it into a new home before that requirement happens.
How long do we have to reinvest the money in the state of Oregon? Also, how much is the tax rate if we fail to do so? We are not interested in buying rental property with the money. What other options might we have that are secure and have liquidity? Thanks!
Short answer ~ There are no taxes paid on your primary residence, any home that you own for 5 years or more, and have lived in for more then 2 years of the 5 is considered your primary residence. You have the right to claim tax exemption for up to $250k, and $500k if you're married. You also have the right to reduce any tax liability by amounts paid for renovation, new flooring, new siding, new roof ect.
In the future if you buy a home and it's your primary residence, and your inherit your mothers home. You can sell which ever home will not be your primary residence under a 1031 exchange. That is a little more complicated then what is appropriate to write about to answer your question. But basically if you sell and buy like property within 180 days from sale to purchase, you can avoid taxes. That is very basic and there are obviously other things you need to know.
Jason H. Gomes
Prudential NW Properties
Greater Portland Area
Cell: 503.608.8785
Desk: 503.350.7378
No tax if you sell one time $250,000 profit for single and $500,00 for married. You might think about investing if you are out of the market 4-5 years values of what you want to buy might go up more than you think.? Talk to a tax attorney and see if you can work something out.
Tom Inglesby, Broker
RE/MAX Equity Group Inc.
A,
Talk with a CPA that knows Oregon tax law. My recommendation is that there will be OTHER financial and tax considerations that should be addressed at this time (setting up a trust, living wills, etc.). Also talk with a probate attorney.
I know that we have many very intelligent Trulia Voices. But none know your family's personal tax and financial situation. IMHO it is unethical to provide absolute answers without knowing ALL the facts.
Good lucki.
Aundrea.
No Taxes are owed. You get to keep up to $250,000 each spouse on any gains over your basis provided you have lived in the home 2 out of the last 5 years.
Given your 12 years stay and this being your primary residence it appears you are in a tax free situation.
Best wishes;
Dirk Knudsen
ReMax Metro
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