Re: Closing Cost - Posted by Ronald * Starr(in No CA)
Posted by Ronald * Starr(in No CA) on January 31, 2002 at 21:29:42:
As this is your own residence, you qualify for an exclusion on the capital gains tax when you sell the property.
Oh, I am not an attorney or a CPA.
Normally, one has to live in the house a total of 24 months in the 5 years before the sale date to get the exclusion. HOWEVER. There is a special exception made for those people who must move because because of a change of job location. You will get a pro-rated exclusion of the federal capital gains tax. You probably better talk to a CPA to get the exact details.
Another thing, the fix-up costs, materials and other people’s labor costs – not your own labor-- is added to the “basis” of the property. You subtract the basis from the net selling pric – after taking off the costs of selling – to get the gain. Actually, any fix up costs incurred shortly before selling the property–within 90 days, I think–can be deducted from the gross selling price to reduce the net selling price. Or at least they used to be deducted before the capital gains exclusion rule changed. That may have changed. Again, I suggest professional advice.
Good InvestingRon Starr********