Question Details

Brenda, Both Buyer and Seller in Albertville, AL

We bought a house in August 07 and I hate it!!!I know that if I sell within the first 2 years I have to pay

Asked by Brenda, Albertville, AL Mon Apr 7, 2008

capital gains tax. How is that decided?
Let's say I paid $95,000 for the property and I have made improvements that will hopefully get $113,000 for it. Does anyone have any idea how much the capital gains tax would be? I am selling it FSBO, have made around $5000 in improvements and will have spent around $200 for advertising. I live in Alabama. Thank you for your help.

Help the community by answering this question:

Answers

1
Brenda
I don't know where Albertsville is....so you may need to talk with a CPA that knows your state's laws
Generally speaking capital gains (I am NOT a CPA) is the cost you paid, plus improvemements.
So Capital gains would be the tax on the difference between what you paid, versus the price you sell, less improvements. Soif you might be looking at a couple of thousand dollars in gain. There are short term and long term capital gains, less than a year is short term.

However, I don't mean to burst your bubble, but the gain will only be a problem is you sell. In most markets, owners selling on their own have two characteristics: They either do not sell and list with a Realtor, or if they do sell, they sell for less than market price.

I would like to encourage you to please consider at least interviewing a couple of Realtors. Ask them to prepare an "estimate of sellers net proceeds". Then you work the numbers.

Good luck
0 votes Thank Flag Link Mon Apr 7, 2008
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
Contact
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer