More Tax Law (Questions About Taxes) Answers
Question Library
Ask a question about Tax Law (Questions About Taxes)
Volunteer
Experts of the Month
Expert Login
Awards
About Us
Tell friends
Link to Us
Disclaimer
|
| |
|
|
| |
| | | |
About Mike Wellman
Expertise
I was a former Manager with Price Waterhouse, now PricewaterhouseCoopers, the largest accounting firm in the world. I have had clients in almost every industry and of every size.
I will only answer questions dealing with IRS problems such as delinquent tax returns, Offers in Compromise (Tax Settlement), IRS collection matters including installment agreements, liens, levies, seizures, audits, appeals, innocent spouse claims and injured spouse claims. All other will be referred to the question pool.
Experience
Over 25 years experience in taxation specializing in IRS collections, examinations and appeals.
Publications
New York Times, Wall Street Journal, Your Money.
Education/Credentials
BBA, Baylor University.
Awards and Honors
IRSOS.com won the Knowledgeweb award for educational excellence for content.
| | |
| |
You are here: Experts > Business > Corporate Law > Tax Law (Questions About Taxes) > Capital Gains Tax
Expert: Mike Wellman
Date: 1/9/2008
Subject: Capital Gains Tax
Question
I bought a house four months ago and have been living in it as my primary residence. I bought it for $165,000 and I made $15,000 renovations and now I'm selling it b/c I got a job in Georgia. My sales price is $199,500. If I sell it for this will I have to pay capital gains tax? Someone told me I have a capital gains tax exception b/c I am selling b/c of a job relocation... They said the normal exclusion is $250,000 if you have lived in the home for 2 or more years. Then stated since I live there 4 months I take 4 and divided by 24 = .16666, then I times by the max exclusion of $250,000, which is $41,666. They said I can make that much of a profit without paying capital gains... Is this correct? Also if I do end up paying capital gains, when is it paid (at closing time, or tax time?) Thanks!
Answer
That is correct. If the primary reason the home is being sold is due to job related relocation, a portion of the gain may be excluded as you have calculated.
Capital gains taxes are paid when your return is filed but there may be a requirement to make estimated tax payments. This will not apply in your case since the gain will be excluded.
Add to this Answer
Ask a Question
|
|
