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TaxRobin, Tax Preparer
Category: Capital Gains and Losses
Satisfied Customers: 15607
Experience:  15+ years in Tax preparartion as well as Instructor for tax law, theory, and application
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If I moved into my second home and claimed it primary

Customer Question

If I moved into my second home and claimed it for my primary residence and lived there for two years , what kind of capital gains tax would I be subject to paying. Is there a schedule based on the number of years over the two year period?
Submitted: 1 year ago.
Category: Capital Gains and Losses
Expert:  TaxRobin replied 1 year ago.


If you lived in and owned the house for 2 out of the last 5 years prior to the sell then you can exclude up to $250,000 of the gain if single and up to $500,000 of the gain if married filing joint.

If you do not then you will pay tax on the gain you receive for selling the 2nd home.

It is the gain you pay tax on so it would all depend on the amount you receive for the house that is more than your cost (plus improvements).

The capital gains rate is base don your filing status and your total income for the year. You could pay 0% if you are in the 10% or 15% ordinary income tax brackets. However, a 20% tax rate on net capital gain applies to the extent that a taxpayer’s taxable income exceeds the thresholds set for the 39.6% ordinary tax rate ($413,200 for single; $464,850 for married filing jointly or qualifying widow(er); $439,000 for head of household, and $232,425 for married filing separately).