My sister and I just recently sold a lake property that we have owned for 25+ years. It is a 3-season home, and was only used by the two of us off and on during the summers. If our income tax bracket is 15 % or below, do we have to pay capital gains taxes on the sale?
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For 2012, the 0% capital gains rate will apply if you are in the 10 - 15% tax bracket. You will still need to report your individual portions of the capital gain on your individual tax returns, but you most likely will not owe any tax related to the sale.
Enrolled Agent with 8 years experience in tax return preparation, representation, and taxpayer consultation