also posted on tax strategies board:We are selling a house for $280k. My husband bought it 3-4 years ago for $273.9k. The realtor fees will be $8960 (No sellers realtor - FSBO - we pay the buyers realtor comission which is 3.2% - we advertised the extra .2% as an incentive). Our closing costs will probably be $1-2k. We put a little more than 5k into the house immediately before selling for interior paint, new carpet, "staging", landscaping, and repairs (although we didn't have our own realtor, all these expenses were advised by multiple buyers realtors who showed the house). While DH owned the house, the only major improvement he made was a new fence which cost $1500. He also made minor repairs of course during the time he owned it. We moved out of the house in March, put it on the MLS in May, and the closing date will be Sept 30 - so we have about 7 months of mortgage, utilities, lawn mowing, maid service, etc., while we weren't living in it. Also, when he bought the house, he had about $2,000 in closing costs, and he refinanced once for another $500 or so in loan costs.So, the question is, which of these expenses can we write off as a loss on our taxes?
foxfam,It is my understanding from what tax law I know that you cannot write this off as a loss. I think the best you can hope for is that you have no capital gains to declare. You may want to post this on the tax board. -b-
This post brings up a good question, do you always have capital gains on a home sale if your home sold for more than you purchased it or are there time frames where you don't have the taxes? I'm in my first home and never sold a home so I don't know anything about that. I thought I remembered some tax break if you lived in your house a certain number of years, was I dreaming?
Oooh, sorry, just found my answer, in short:The key to the entire plan is that you are allowed to sell a principal residence once every two years and exclude up to $250,000 ($500,000 for a married couple) of the gain on the sale.
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