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R. Klein, EA
R. Klein, EA, Enrolled Agent
Category: Capital Gains and Losses
Satisfied Customers: 263
Experience:  Over 20 Years experience in resolving tough tax cases
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I have purchased house in 1995 .I reside in ny state. I have

Customer Question

I have purchased house in 1995 .I reside in ny state.
I have mortgage of 700 000
property is worth about 2.5m
How much capital gains is exempted and how much is the rate of long term tax.
If i invested part of the sale proceeds for buying a new house.
Submitted: 1 year ago.
Category: Capital Gains and Losses
Expert:  Jonathan Tierney replied 1 year ago.

Hi, my name is ***** ***** I can help. What is your filing status: single, married filing joint, etc? Also is this house your personal residence or was this a rental property?

Customer: replied 1 year ago.
Filing joint
personal residence
Expert:  Jonathan Tierney replied 1 year ago.

Okay, $500K of the gain will be exempt from capital gains regardless if you spend the proceeds of the sale in another home. That would still leave you will a net taxable gain of $1.3 million which for federal purposes will be taxed at the top 20% long-term capital gains rate as well as be subject to the 3.8% net investment income tax. New York State taxes income above $425K at the 6.85%.