Have a Finance Question? Ask a Financial Expert Online.
Thank you for your question, and thanks for using JustAnswer.com. Yes, you will need to pay tax on the funds from the construction contract
You cannot deduct the cost of purchasing your home, or defer taxes because of this.
So, you will pay tax on the construction contract profits
What rat of tax would I pay
What is your other income, and do you file as single, head of household, or a married filing joint return?
Married filing jointly. Spouse is a teacher receiving $30,000 annually
So you have $250,000 of joint income that year?
More like $320,000
You will be in the 33% tax bracket
OK you will be in the 33% tax bracket
Is there any tax break for buying a house
No, there is not
Only tax benefits of home ownership are that you can deduct mortgage interest and real estate taxes if you itemize, and when you sell the house at a gain you can exclude a portion of that gain
Do you have any further questions about this matter
If you have no further questions about this matter, please take a moment to rate my response as "excellent" so that I may receive credit for assisting you today