Capital Gains Tax Information

When you sell your home, you may be subject to a capital gains tax because of the increase in value while you’ve owned it. Fortunately, there are ways to limit that capital gains tax on a home sale so you can keep as much profit in your pocket as possible!

Take a look…


Calculating capital gains tax in real estate can be tricky. The tax rate depends on many factors such as your tax bracket, marital status, how long you’ve owned the home and wether it was your personal home or an investment property. Here are the General parameters…


If you are selling your primary residence and you have owned and lived there for at least 2 years then you can avoid paying capital gains taxes on the first $250,000 if you are single or up to $500,000 if you are married and filing jointly. This exemption is allowed every 2 years.


If you plan on selling an income property, you will need to plan ahead to lower your tax liability. In short there are Three ways to avoid or lower your tax liability:


  1. Establishing the rental as a primary residence
  2. Doing a 1031 Exchange which just puts off your taxes.
  3. OR investing in an Opportunity Zones which are designated as low income areas.


Make sure you keep a good record of all property expenses, improvements, repairs, losses, fees and other costs from the purchase of the home so that you can take advantage of all eligible deductions.


Don’t forget to  check with your tax attorney or accountant for information specific to your situation before selling your property.


If you are ready to buy sell or invest, give us a call Pinyon Properties is your real estate one stop shop!

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