Capital Gains Articles - Page 1

Proper estate planning will help you avoid paying long-term capital gains tax when you sell inherited property. If your relatives plan with an attorney or tax advisor for how they would like their assets to be distributed, you can avoid paying unnecessary taxes on your inheritance and assets.

Use seller financing to save your capital gains tax exemption if your buyer is having trouble getting conventional financing. To qualify for a capital gains tax exemption you must fit under certain guidelines, like how long you have lived in the home as your primary residence. Seller financing can…

When you own a primary residence and turn it into a rental property you will be unable to take the same tax deductions as you would if it were a primary residence. If you later decide to change the property ownership from yourself to an LLC - a limited liability company - that will also affect your…

Renting out part of your primary residence will change how your capital gains tax is calculated when you later sell. If you didn't have a rental property as part of your primary residence, you could save taxes on up to $250,000 of profit from the sale, if you're single. When you have a rental…

Currently, when you inherit property, the cost basis when you go to sell is the property's market value at time of the person's death. You pay capital gains tax on the difference between the market value and the selling price of the home. This stepped-up cost basis is set to expire in 2010, and so…

An investor received stocks as a gift many years ago, and recently sold some off. The gains on the stock will need to be calculated from the day it was received as a gift. If there has been a gain on the stock, taxes will need to be paid on it.

If you sell real estate you’ve owned for less than a year, you will own income tax on the profit. If the property is sold more than a year later, capital gains tax would be owed. A 1031 exchange defers taxes when selling and buying like property.

Taxes on inherited property are paid by the estate. If the inherited property is owned for a year or more and then sold, long-term capital gains tax will be owed. But taxes shouldn’t be owed on inheriting the property itself.

Selling vacant land and using the profits to buy a home may result in a 15 percent capital gains tax. Capital gains taxes can be deferred if he used the profits to buy another investment property. To avoid paying capital gains tax on vacant land, a home would have to be build and lived in for two…

If you’ve lived in a home for two of the past five years as a primary residence, you may sell and keep up to $250,000 in profits tax free, or up to $500,000 if you’re married. If the property was rented for part of that time and any tax deductions taken, those will need to be recaptured. A tax…

Capital gains taxes may be owed on a home that was quit-claimed. Generally, if you live in a home for two years as a primary residence, a certain amount of profits can be kept tax-free. With property acquired through a quit-claim, capital gains taxes will be owed on the difference between the price…

A homeowner wants to put his investment property into a trust to avoid capital gains taxes. To avoid capital gains taxes, you have to live in the for-sale property for two out of the past five years. A smarter way for this homeowner to avoid capital gains would be to use a 1031 exchange.

Can you sell a portion of your property, but avoid paying capital gains? Should you sell all the property then buy back the portion with your primary residence, to avoid or pay minimal capital gains? A good real estate attorney who can help you make the right decision about selling property and…

An heir sold her half of inherited property to her sister for $10 using a quit claim deed and wonders if she owes taxes on the sale. The taxes owed, if any, will be small because of the low sales price.

Is it worth it to sell your home before living there 2 years and pay the capital gains tax - especially if you're living in a skyrocketing housing market. Despite the capital gains tax, if the market value of your home is increasing drastically, it might be worth it. But, if you have not lived in…

A home owner wonders if they should down size to a smaller home to avoid capital gains tax. Ilyce suggests they consider which of their options has a bigger profit potential despite the capital gains tax. Ilyce explains the possibilities of profit potential from both houses to help the home owner…

The only way to defer the payment of capital gains or depreciation taken on rental property is for the homeowner to sell this investment property and purchase another one in a like-kind exchange, also known as a "Starker exchange" or a "1031 exchange." A 1031 exchange means the seller sells his…

How can a home seller know if they'll pay capital gains taxes on the sale of their home? In general, if you live in a property for two out of the prior five years, and the property was your primary residence for two years, you are entitled to exclude $250,000 of the gain in the sale of the home from…

Sometimes it can be difficult to calculate the taxes owed on sold property, but capital gains is one thing the seller should consider. If you're not sure about how to calculate the taxes on sold property and whether capital gains applies to you, the best thing to do is contact your CPA to calculate…

When you sell a rental property you have to pay capital gains tax on the amount of profit you made on the property. The amount of mortgage loan you had on the property does not affect the capital gains tax. In addition, when you inherit property you inherit it at the market value it had on the day…

What's the best way to pass a second home on to heirs? If you don't want to pay capital gains tax on a sale or a gift tax you should give your heirs an ownership share of the home gradually. If you give an amount of the real estate investment equal to the amount that's not subject to gift tax you…

When you're relocating your family for a short, set amount of time should you rent or buy a home? In light of the current housing market, it may be better to rent. You may not be able to recoup the costs of buying a home in a short time frame. When you're choosing between buying and renting think…

When you sell a home after your spouse dies you may be able to keep some of the profits tax-free, depending on how much they were. The IRS currently allows taxpayers to keep up to $500,000 in profit tax-free if they've sold their home within two years of the spouse's death. To find out the tax…

There are several decisions to make when flipping real estate - should you pay capital gains tax or should you apply for a 1031 exchange, borrow against the property and keep the land. Having to pay capital gains tax may be a factor in a property owner's decision to keep the land and apply for a…

If you own a second home and decide to sell it you'll have to pay capital gains tax. To calculate your capital gains tax you first have to calculate the sales price after subtracting the cost of any improvements you made to the home. The sales price that's taxed will most likely be less than the…