Health & Fitness
3 Major Tax Issues Every Seller of Real Estate Needs to Know
Need more assistance with real estate? Contact Bruce Webb, Associate Broker, Coldwell Banker Preferred bruce@brucewebb.com www.brucewebb.com (734)392-6021
1) Increase in the exclusion from capital gains tax on the sale of a principle residence from $125,000 in capital gains to $500,000 for filing joint taxpayers ($250,000 exclusion of a profit for single taxpayer). This exclusion can occur every 2 years. The repetitive ability is a great opportunity to buy and sell a principle residence and either move up or buy down. There is no age restriction on who is eligible for this exemption.
2) First-time homebuyer incentives:
-Save income in a tax-deferred IRA account with the purpose of saving for a down payment and withdraw down payment at any time without penalties for early withdrawal.
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-Parents can save money in a tax-exempt savings account for the purpose of assisting children with a down payment for housing.
3) Investments in real estate.
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4) Reduction in capital gains tax rate from 28% to 20%. This will increase the profitablility of a real estate holding.
Bruce Webb, Associate Broker, Coldwell Banker Preferred
(734)392-6021