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jbfoell · Joined: 19 Jan 2010 Posts: 2 1.53 Dollars($)

I know a little about the 3 circumstances that have to apply in order for you to have to pay the recapture tax.
But this one I can't figure out:
-Your household income for the year in which you sell your home exceeds federal recapture tax limits

What are the limits? Where can I see what these limits are? I guess I'd like to consider what I make and see if it is under the limit.

gmakerley · Posted: Tue Jan 19, 2010 1:46 pm Post subject:

here is the chapter and verse concerning the federal recapture tax:

The payment of federal recapture tax occurs at the time a borrower's property is sold, only if all three of the following conditions apply:

1. A borrower sells their home within the
first nine years of ownership, and
2. There is a capital gain on the sale of the home, and
3. The borrower's household income at the time of the sale exceeds applicable federal recapture tax threshold income limits that were in place at the time of the initial purchase.

you will want to discuss this with a tax preparer for more information and clarification. you can also query with the irs directly.

as for the income limits, they are based on the locale where you live.

as a general rule, your income would have had to make a substantial climb and the value of your property would have had to escalated greatly as well.

jbfoell · Joined: 19 Jan 2010 Posts: 2 1.53 Dollars($)

ok, I guess that still does not answer my question...
because....
1. I was hoping on selling before the 9 years is up
and
2. I know I will probably make a profit, if not very large, on the sale...

So, I still need to know what the income limits are.
Can anyone tell me where I can find Wisconsin income tax limits? Because I read somewhere your income would really only have to increase by more than 5% each year, and that doesn't seem like much.

Niicss · Posted: Wed Jan 20, 2010 2:42 am Post subject:

You can check out the given page in order to know the income tax limits for Wisconsin:
"http://www.dor.state.wi.us/faqs/pcs/taxrates.html#txrate1"

gmakerley · Posted: Wed Jan 20, 2010 9:42 am Post subject:

perhaps knowing location would have led to a more helpful response.

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Recapture Tax