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Wallstreet Esq.
Wallstreet Esq., Tax Attorney
Category: Tax
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Experience:  10 years experience
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Last yr husband and I sold home. we bot it in 2012 for $430

Customer Question

last yr husband and I sold home. we bot it in 2012 for $430 paid for cash. sold it 11/2015 for $640 We filed for divorce 11/2015 We.split proceeds 50/50 In 12/2015 I bot a house for 360K paid cash. He put all money in bank.Divorce final 3/16/2016. CPA says to file joint and needs itemized list of all improvements with costs. I thought the one-time cap gain exemption @$250k per person or $500k/couple makes list unneeded.Also as I reinvested all gain I thought ther would be no cap gain. ..But because he did not reinvest anything he would be the one who needs the itemized list IF the exemption wouldn't cancel this.I can file separate if I want..I do not know if i would be subject toany tax and do I need the LIST..pls avise
Submitted: 6 months ago.
Category: Tax
Expert:  emc011075 replied 6 months ago.
Hi. My name is ***** ***** I will be happy to help you. I don't see a reason for the list of improvements. If you lived in the house for at least two years each of you would qualify for the 250K exclusion, regardless how you file. The fact that you re-invested the proceeds doesn't make any difference, it is irrelevant. The 're-investment' provision had been actually replaced with the 250K exclusion and it is not a one time or life time. You can use the exclusion every two years as long as you meet the conditions. Either way you shouldn't be paying any capital gains. Maybe your CPA is trying to create "extra work" for himself to charge you more for your return. It should be pretty straightforward.