The Good News - Bad News About Capital Gains!

Dated: August 21 2020

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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!

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Kenneth Manesse

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

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