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re: If I sold my house, do I have to show it?
Posted on 1/23/21 at 5:25 pm to toosleaux
Posted on 1/23/21 at 5:25 pm to toosleaux
quote:
If you owned and lived in the place for two of the five years before the sale, then up to $250,000 of profit is tax-free.
I thought this was the sole consideration. I’m in the process of selling a house, too, and my profit won’t be above that number. I was under the impression that I wouldn’t have to show it because of that.
2
Posted on 1/23/21 at 5:42 pm to High C
Did you live there? You keep calling it a 'rent house' which most people would interpret as you rented it to someone else. Unless you've been living on 1 side of a double, the personal residence capital gains exclusion doesn't apply.
Your cost basis is your $80,000 minus the 7 years of depreciation you've claimed on your schedule E each year, which would be about $20,363 less (depreciating residential property over 27.5 years but will have to be adjusted based on your actual figures) or about $59,636. You'd pay capital gains tax at your capital gains rate on the difference between $80,000 sales price and your cost basis.
Your accountant should be able to answer this question in about 3 minutes, as he's been tracking your cost basis each year. If you don't have an accountant already, you need to get one for this.
Your cost basis is your $80,000 minus the 7 years of depreciation you've claimed on your schedule E each year, which would be about $20,363 less (depreciating residential property over 27.5 years but will have to be adjusted based on your actual figures) or about $59,636. You'd pay capital gains tax at your capital gains rate on the difference between $80,000 sales price and your cost basis.
Your accountant should be able to answer this question in about 3 minutes, as he's been tracking your cost basis each year. If you don't have an accountant already, you need to get one for this.
This post was edited on 1/23/21 at 6:09 pm
Posted on 1/23/21 at 5:45 pm to High C
Derp, my error, I replied to wrong post. You're talking about your own residence, OP is talking rental property.
This post was edited on 1/23/21 at 5:47 pm
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