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Moving After One Year |
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Hi Edith, I have a question about a selling a home after only one year of occupancy. I bought a foreclosure about a year ago, made repairs, and have been living in it as my primary residence. I am considering taking a job transfer out of the area and was wondering what tax liabilities would I face if I do? I believe the house has appreciated around $35,000 |
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You’re in luck. Even if you haven't owned and occupied your home for at least two years, the IRS allows partial use of the homesellers exclusion from capital gains tax under certain circumstances.
You can use the tax break if you have to move due to one of several unexpected happenings. They include things like a death in the family, the birth of twins and--you'll be happy to learn, a job transfer. If you sell after a fraction of the two years required, you can use that fraction of the exclusion. For a taxpayer filing singly, the normal exclusion is $250,000. If you sell after only one year, having been there half the required time, you can take half of that, up to $125,000 profit, free of federal tax
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Edith
Originally published on August 6, 2006 |
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