Buying or Selling a Home/Capital Gain Deferal

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Expert: - 9/9/2008


Question
Hello Karen,

I plan to sale my house.  There will be approx $300K capital gains.  Looking at Pub 523 I do not see how many months I have to purchase another home without paying taxes.

Thanks   Bill

Answer
Hi Bill,

Your question was addressed to “Karen.”  Perhaps you meant this question for another expert, but I will give you my understanding of capital gains.

My understanding of the capital gains tax law as changed a number of years back is that an individual can “defer” up to $250,000 of GAIN every two years in a PRINCIPAL residence ($500,000 of GAIN for a married couple).  There is currently no time limit in which to purchase another home.  

Your question deals more with tax issues and accounting, an area I am not expert in; so you should verify the above with an expert in tax law.

Regards,
Elizabeth

Buying or Selling a Home

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liznarr

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I can answer questions relating to the purchase and/or sale of residential homes and land, including what a really good agent should be expected to do and/or not do; where to turn when problems occur; and questions regarding disclosure. I`m a Licensed Realtor in the Southeast since 1984 with designations of Broker, GRI, CRS, and CBR (Certified Buyer Representative). Current active and Life Member of Million Dollar Club, Certified by State Real Estate Commission to teach Pre-Licensing and Continuing Education courses, specializing in Agency. Currently serving on Grievance and Professional Standards Committees, and Education Committee in past.

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