The Good News - Bad News About Capital Gains!

Dated: August 21 2020

Views: 322

The good news about capital gains on real estate!

The IRS typically allows you to exclude up to: $250,000 of capital gains on real estate if you're single. $500,000 of capital gains on real estate if you're married and filing jointly.

The bad news about capital gains on real estate!

Your $250,000 or $500,000 exclusion typically goes out the window, which means you pay tax on the whole gain, if any of these factors are true:

  • The house wasn’t your principal residence.
  • You owned the property for less than two years in the five-year period before you sold it.
  • You didn’t live in the house for at least two years in the five-year period before you sold it. (People who are disabled, and people in the military, Foreign Service or intelligence community can get a break on this part, though; see IRS Publication 523 for details.)
  • You already claimed the $250,000 or $500,000 exclusion on another home in the two-year period before the sale of this home.
  • You bought the house through a like-kind exchange (basically swapping one investment property for another, also known as a 1031 exchange) in the past five years.
  • You are subject to expatriate tax.

Click below to download the worksheet!

Want more info? (Click Here)

Blog author image

Kenneth Manesse

Helping you experience something new in Las Vegas that's guaranteed. Real Estate with less stress!....

Latest Blog Posts

Getting Ready For RETIREMENT in Las Vegas

For most people, retirement feels like a long way off. But, if you don’t start preparing as early as possible, you may find yourself in a place of financial insecurity when the time does come.

Read More

Why you should sell your 2 story home in Las Vegas!

You can't deny that you "have to sell" your 2 story home. Your knees will thank you! List of 1 Story Homes (Las Vegas 1st Homes)Want to check your homes value?  Find out (What is my

Read More

How to buy a REO in Las Vegas

If you’ve thoroughly prepared yourself for owning a home with a poorly documented history and a higher than normal risk of unexpected problems, as well as the stressful buying process that can

Read More

Four reasons why putting 20% down is a good plan.

Here are four reasons why putting 20% down is a good plan if you can afford it. 1. Your interest rate may be lower. A 20% down payment vs. a 3-5% down payment shows your lender you’re more

Read More