Do you have to pay capital gains tax on the sale of your home? Well, that depends. The new provisions or the provisions and the internal revenue code that have been there for several years provides that. If you’re a single person and you sell your home and you’ve lived in the home for two of the past, owned and lived in your home for two out of the past five years, you can exempt up to $250,000 of gain. So, if the sale of your home is less than 250,000, the sale is not even reported to the Internal Revenue Service. You may have to check a box that you sold your house. However, if it’s for more than 200 and $50,000, whenever you do your taxes, your accountant will know to exempt the gain. So, you’ll have to show your basis and then exempt $250,000 of gain if you have more than $250,000 in gain.
Yes, you would have to pay capital gains tax. If you’re married and you own this house jointly and have owned and lived in the house for two out of the past five years, the amount increases to $500,000. So, if the house sells for less than $500,000 per husband and wife, then you can, you don’t even have to report the sale. If it sells for more than that amount, you can exempt up to $500,000. And if you have more than $500,000 of gain, you would pay the capital gains tax on any, any gain over and above the 5,000. If you have any question about the sale of your house, give me a call at (727) 847-2288.