Posted on: 19th Nov, 2009 08:35 am
In indiana.....I have a house that is not my primary residence....doing improvements but also want to avoid capital gains tax when I sell....What is the rate of tax if I live in it for 1 year?.....2 years?......Is there a way of avoiding capital gains without moving into property?
Hi tsquires,
The capital gains tax rate will depend on the the income tax bracket you are in. If you sell the property and make a profit, you will have to pay capital gains tax. However, there is a exemptions avaible. If you occupy the property as your primary residence for at least 2 out of the last 5 years, your capital gains can be tax-free. In that case, you can take upto $250,000 in profits if you are single and $500,000 if you are married.
Thanks,
Jerry
The capital gains tax rate will depend on the the income tax bracket you are in. If you sell the property and make a profit, you will have to pay capital gains tax. However, there is a exemptions avaible. If you occupy the property as your primary residence for at least 2 out of the last 5 years, your capital gains can be tax-free. In that case, you can take upto $250,000 in profits if you are single and $500,000 if you are married.
Thanks,
Jerry