Personal Residence, sold less than 2 years - Posted by V.

Posted by Bigfoot on April 02, 2006 at 16:18:18:

There are certain circumstanses where you can avoid the capital gains from selling within two years. (I believe that having to sell because of a job change is one- Talk to your accountant) Your question about buying a new property no longer has relavance. Under the old law you had to buy another property within, I think 2 years of the sale of the old one, then could roll over the gains until you got a one time exclusion after age 55. But those conditions no longer apply.

Personal Residence, sold less than 2 years - Posted by V.

Posted by V. on April 01, 2006 at 18:54:42:

will I have to pay capital gains?

What if I buy a property that costs less than my previous residence?

Case - bought house in April of 2005 for 225K, selling in April 2006 for 250K. Closing costs=10K, net profit=15K.

Buy another home for 200K.

Do I have to pay the capital gains tax? If so, which amount will be taxed?

Thanks,
V

Re: Personal Residence, sold less than 2 years - Posted by John

Posted by John on April 01, 2006 at 20:17:19:

15K is taxed as capital gain if you own the property 1yr and 1 day less than that it is taxed as income

Re: Personal Residence, sold less than 2 years - Posted by V.

Posted by V. on April 02, 2006 at 16:07:07:

Thanks,

What if I buy another residence that is worth more than what I paid for the previous one? In other words, is there a away I can pay NO taxes on the gains?

Re: Personal Residence, sold less than 2 years - Posted by John

Posted by John on April 02, 2006 at 17:15:20:

That law was changed I believe in 1987, Now the 2 year rule applies with an exception of move because of job or job transfer. Seek advise of a CPA.
You don’t have much profit to avoid tax on here. Purchase price plus purchasing costs subtracted from selling price minus selling costs minus any improvements you made. This leaves only a small amount of profit that is taxable. Like I said seek professional tax advise from a CPA