As we get nearer tax time a reminder to exclude any gain on primary residence sold in 06 if primary res for past 2 years. $250K filing single, twice that filing jointly. This can be huge!
Explains the law and a few exceptions. I was shocked at MHM and MOM at the folks that were not aware that this law exists and can be used every 2 years with few exceptions.
In broad strokes a person (or family) can exclude up to 500K from a sale if the home was a primary residence 2 of the last five years. The last one I did I forget exact numbers but i excluded 140K plus in gain. I held the home 2 years and a few days prior to sale. I have moved every 2 years since.
Obviously this works best in an appreciating market, buy a loss can also be deducted as an active loss. WOW! this is one of the best things our gov has done for us. For me to put 70K in my pocket each year, I need to gross over 110K…and that is not figuring both sides of social security (I am a dealer).
What amazes me is one of my customers sold a home they were in 4 years did a cap gain on over 78K, sent this in with 2005 taxes and the IRS cashed their check!! There response at my look of horror? You only get to exclude gain one time in your life and we did that in 96!! They went to my own
accountant and are filing an amended return for 05.
99% of the folks on this forum know of this law…this is for the 1% that don’t! Happy investing all.