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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7866
Experience:  15years with H & R Block. Divisional leader, Instructor
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Trying to figure out what my taxes will be on sale of my home

Customer Question

Trying to figure out what my taxes will be on sale of my home this past year 2010.
I bought it for 38,000 and sold it for 675000. I put at least 300,000 into renovations over many years and am eligible for the 250,000 deduction I believe.
I am in the lowest tax bracket living mainly on ss. of 24000.
I also have some capital gains on stocks this year and wondered what the taxes will be on this. I have read different things about 0% for lower tax bracket.
Submitted: 4 years ago.
Category: Tax
Expert:  Robin D. replied 4 years ago.

Robin D :

Hello and thank you for using Just Answer.

Customer :

I did not push button for subsctiption which I am not sure I want. What do I do now?

Robin D :

Your basis in your home will determine any taxable portion on the sale. If your Basis is $338,000 and you sold for $675,000 then your gain is $337,000. From that you can exclude the $250,000, this would leave $87,000 of gain and that would be the Capital gains potion that would show on your Schedule D.

Robin D :

Let's just finish our chat.

Customer :

yes I know this but how much will the tax be on 87,000?

Customer :

and how much will it be on other capital gains in 2010

Customer :

thanks

Customer :

am I talking with a tax expert-cpa or a member? I appreciate knowing this

Robin D :

The rate for your tax on the home will be either 5% or 15% depending on your regular tax rate. The stock will depend on your income and holding period but could be 0% or 15%.

I am a tax professional with 17 years experience in the tax preparation industry.

Robin D :

The 0% would require that you be in the lower tax bracket (10 and 15 % brackets)

Customer :

thank you so much and now how does one determine if it is 5% or 15% tax rate?

Robin D :

One minute and I will look up for 2010

Customer :

What are the lower brackets of 10 or 15% for capital gains

Robin D :

































Single 2010 Tax Brackets
Taxable Income:Income Tax:
$0-$8,37510% of the amount over $0
$8,375-$34,000$837.50 plus 15% of the amount over $8,375
$34,000-$82,400$4,681.25 plus 25% of the amount over $34,000
$82,400-$171,850$16,781.25 plus 28% of the amount over $82,400
$171,850-$373,650$41,827.25 plus 33% of the amount over $171,850
$373,650+$108,421.25 plus 35% of the amount over $373,650
Robin D :

The chart deals with TAXABLE INCOME this means after deductions and exemptions so until you know what those are (single?, itemized deductions or standard, credits) it would be difficult to say for certain. Although you could do an estimate of your 2010 return to see just wher you may fall.

Customer :

and the 5-15% for the home?

Customer :

also on capital gains I don't see where the 0% is.

Customer :

it looks like 10% is the least-- I had heard that it is 0% for some people. am I wrong and are they wrong?

Robin D :

The zero % would be for individuals that fell into the 10 and 15% brackets. hat would be for your stock. The real estate is at a slightly higher rate.

Customer :

thank you- my normal income would be below 34,000 but becasue of these real estate and other captial gains, i will probably fall into the higher bracket of 62,000 - 171000? Is that correct.

Robin D :

That is correct.

Customer :

so it is not based on your regular income which is SS?

Robin D :

No all income will bve used for calculations. Be advised, some of your SS may be taxable as well because of your financial activity for 2010.

Customer :

yes i was entering that in the caluculation- adding ss to capital gains-i hope tht is correct

Robin D :

Only up to 85% of your SS may be taxable. that too will be based on your total income.

Robin D :

Here is a link to an estimator that may make things easier for you if you do not have one in mind already:
http://www.2010taxcalculator.com/

Robin D :

Just use it to estimate not file or use one that you feel comfortable with

Robin D :

The turbo is easier with just your home and SS I was able to see your taxable at $160550 (this was using standard and single with no stock info).

Robin D :

Correction!!! $106550

Customer :

thnak you my phone rang and i lost you. will you make sure I don't get charged every month or tell me if they subscribed me.

Customer :

thank you

Robin D :

No, you should be charged the one time when you click ACCEPT for our session. But I can send a request for Customer Service to make sure you are not in the subscription.






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Robin D.
Robin D.
7308 Satisfied Customers
15years with H & R Block. Divisional leader, Instructor