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Best capital gains article.

October 12,2021 | Posted By Flavia Brown in Real Estate
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This informative article will save a ton of money when selling your home. However, it shouldn’t be a substitute for consulting with your tax advisor. Enjoy the article: https://www.homes.com/blog/2021/04/how-to-save-on-capital-gains-taxes-after-selling-your-home/?cmp=hdc-stevecook-042021
To your success,
Flavia Brown, Realtor
P.S. For your convenience here is a capital gains worksheet:


How to Calculate Gain
Your home’s original sales price when you bought it (not what you brought to closing).  
Additional costs you paid toward the original purchase (include transfer fees, attorney fees, and inspections but not points you paid on your mortgage). +
Cost of improvements you’ve made (include room additions, deck, etc. Improvements do not include repairing or replacing existing items). +
Add the above items to get your adjusted cost basis: =
      
The proceeds from selling your home (the amount of money you realized from the sale, less selling expenses, such as brokerage commissions, inspection costs, legal fees, title costs, money you spent to fix up your home to prepare it for sale, and so on.  
The adjusted cost basis figure from above. -
Your capital gain: =

A Special Real Estate Exemption for Capital Gains
Up to $250,000 in capital gains ($500,000 for a married couple) on the home sale is exempt from taxation if you meet the following criteria: (1) You owned and lived in the home as your principal residence for two out of the last five years; and (2) you have not sold or exchanged another home during the two years preceding the sale. You may qualify for a reduced exclusion if you otherwise qualify but are short of the two-out-of-the-last-five-years requirement if you meet what the tax law calls “unforeseen circumstances,” such as job loss, divorce, or family medical emergency.


 

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