Hello! I am a CPA here to assist you with your tax questions. My goal is to provide you with excellent service today.
What did you initially purchase your home for, and did you make any significant capital improvements during the years?
So, if you purchased the home for $100,000 and did a kitchen remodel for $12,000 your basis in the home would be $112,000
You only owe tax on the amount that the sales price exceeds the basis. So, if you sold your home for $110,000 you would have no tax because you would have no gain.
If you sold the house for $120,000 you would have a gain of $8,000 --but still no tax would be due because you are able to exclude gains of up to $500,000
If you sell within 2 years you can exclude the entire $500,000 of gain. If it takes longer than 2 years you can exclude $250,000
There's a good article about this topic, HERE
I don't know the amount the house was purchased for back in 80's. The only improvement was the new roof I put up, that cost about $16,000. According to the property tax statement the house value is about $350.000. What I would like to know if it is the truth that I would be able to exclude gains of up to $500.000 in Oregon
Yes, it's true that you can exclude up to $500,000 in gains in Oregon provided that you sell the house within 2 years of your husband's death. You can find your purchase price at your local office that holds real estate deeds - they will have a record of it.
And you can add $16,000 to whatever it cost to purchase the home.
Thank you Megan. I am relieved by this information. I appreciate your help
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