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levr, Tax Advisor
Category: Capital Gains and Losses
Satisfied Customers: 28081
Experience:  Working for a large tax preparation service
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I am in contract to sell my house for $980.000.00 2/3 of the

Customer Question

I am in contract to sell my house for $980.000.00 2/3 of the house is rental and I paid $277,000.00 for the house. The house is in Brooklyn, NY. How much capital gains do I need to pay
Submitted: 6 months ago.
Category: Capital Gains and Losses
Expert:  levr replied 6 months ago.
First of all we need to treat a part of the house used for rental as a separate asset.Correspondingly a part of the house used as a personal residence woudl be a separate asset as well.
Expert:  levr replied 6 months ago.
So the sale price of rental property would be $980.000 * 2/3 = $653,333The basis of rental property $277,000 * 2/3 = $184,667For precise calculations - we need to know accumulated depreciation and improvements and selling expenses, but as a rough estimation -the gain would be $653,333 - $184,667 = $468,666Depending on your other taxable income - it woudl be mainly taxed at 15% federal income tax rate.NYS tax rates are between 4% and 8.82%and NYC tax rates between .907% and 3.876% 1/3 of the property was used as your primary residence - the gain on that part could be excluded from taxable income..I appreciate if you take a moment to rate the answer.Experts are ONLY credited when answers are rated positively.If you still have any doubts, need clarification - please be sure to ask.I am here to help you will all tax related issues.

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