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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15296
Experience:  15years with H & R Block. Divisional leader, Instructor
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I purchased a home 15 months ago. do i have to pay full

Customer Question

i purchased a home 15 months ago. do i have to pay full capital gains tax if i sale now?
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.

Hello

If a person owns and uses a property as their main home for 2 years out of the five years before they sell they can exclude up to $250k if single and $500k if married foiling joint of gain on the sale.

If they do not meet the 2 years then they pay tax on the gain unless they can meet an exception and be allowed to prorate.

One exception is moving due to job.

Treas. Reg. §§ 1.121- 3(c)(1) and (2) provide that a sale or exchange is by reason of a change in place of employment if (1) the change occurs during the period when the taxpayer owns and uses the property as a principal residence and (2) the taxpayer’s or other qualified individual’s new place of employment is at least 50 miles farther from the residence sold or exchanged than was the former place of employment. If there was no former place of employment, the distance between the qualified individual’s new place of employment and the residence sold or exchanged must be at least 50 miles. The new place of employment may be with the same or a different employer or can include the beginning or continuation of self-employment (Treas. Reg. § 1.121-3(c)(3)). A qualified individual is the taxpayer, the taxpayer’s spouse, a co-owner of the residence or a person whose principal place of abode is in the same household as the taxpayer (Treas. Reg. § 1.121-3(f)).

It depends why you would sell so soon after purchase.

If my answer addressed your question please rate below or above (let me know if you have difficulty as I believe the system changed), if you need more information reply below.

Expert:  Robin D. replied 1 year ago.

I did not hear back from you, if my answer addressed your question please rate below or above (let me know if you have difficulty as I believe the system changed), if you need more information reply below.