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If I sold my house, do I have to show it?
Posted on 1/23/21 at 4:16 pm
Posted on 1/23/21 at 4:16 pm
Stupid financial question. I know.....do it on the money board. Well no one visits the money board on the weekends.
If I sold my rent house last year....do I have to show it as income? Thanks in advance
If I sold my rent house last year....do I have to show it as income? Thanks in advance
6
Posted on 1/23/21 at 4:18 pm to oldcharlie8
It depends on how long you owned and lived in the home before the sale and how much profit you made. 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. If you are married and file a joint return, the tax-free amount doubles to $500,000.
Posted on 1/23/21 at 4:18 pm to oldcharlie8
Did you reinvest it in another property?
Property isn’t hookers and blow
Property isn’t hookers and blow
Posted on 1/23/21 at 4:23 pm to arseinclarse
Lived in it for 7 years. Sold for 80k. Owed 50k. Paid off the 50 and banked the rest. Do I have to show as income?
Posted on 1/23/21 at 4:25 pm to oldcharlie8
quote:hey now. Show some respect.
Well no one visits the money board on the weekends.
Posted on 1/23/21 at 4:30 pm to oldcharlie8
quote:The difference between sales amount and what you owe on the mortgage is not income.
Sold for 80k. Owed 50k. Paid off the 50 and banked the rest. Do I have to show as income?
You probably need a tax preparer to help you with your taxes.
ETA: What kind of house sells for only $80,000?!?
This post was edited on 1/23/21 at 5:00 pm
Posted on 1/23/21 at 5:04 pm to LSURussian
quote:
ETA: What kind of house sells for only $80,000?!?
This one did. Why the frick do you care? What an a-hole question.
Posted on 1/23/21 at 5:04 pm to LSURussian
You're about to learn about recaptured depreciation very soon. Prepare thy anus!
Mortgage has nothing to do with your cost basis, your long term capital gain (on which you'll pay long term capital gains tax) will be calculated based on sales price minus your current cost basis, which is your original cost basis minus all 7 years of depreciation you've claimed on your schedule E.
Get ready to write a big check, Biden and Harris thank you!
Seriously, you received a 1098-E form from the closing agent verifying the gross sales price among all the other closing documents, a copy of which also goes to the IRS, so they'll be waiting for your accounting of the sale and recaptured depreciation on your tax return.
Mortgage has nothing to do with your cost basis, your long term capital gain (on which you'll pay long term capital gains tax) will be calculated based on sales price minus your current cost basis, which is your original cost basis minus all 7 years of depreciation you've claimed on your schedule E.
Get ready to write a big check, Biden and Harris thank you!
Seriously, you received a 1098-E form from the closing agent verifying the gross sales price among all the other closing documents, a copy of which also goes to the IRS, so they'll be waiting for your accounting of the sale and recaptured depreciation on your tax return.
This post was edited on 1/23/21 at 5:10 pm
Posted on 1/23/21 at 5:06 pm to MaxDraft
quote:
Why the frick do you care?
Why the "frick" do you care about what I care? What an a-hole question...
Posted on 1/23/21 at 5:13 pm to oldcharlie8
You probably could have done a 1031 exchange but likely too late for that given you sold it last year and there is a 45 day window from sale to ID new investment properties and 180 to close on it.
How much did you pay for the place? Or if inherited what was value when you inherited the property. That's more relevant than the mortgage balance at time of sale. If you sold for $80k doesnt seem like a ton of room for capital gains. I'd ask an expert.
How much did you pay for the place? Or if inherited what was value when you inherited the property. That's more relevant than the mortgage balance at time of sale. If you sold for $80k doesnt seem like a ton of room for capital gains. I'd ask an expert.
Posted on 1/23/21 at 5:17 pm to TorchtheFlyingTiger
Bought for 80 and sold for 80
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.
Posted on 1/23/21 at 5:38 pm to LSURussian
quote:
Why the "frick" do you care about what I care? What an a-hole question...
No you’re just an a-hole.
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 5:42 pm to oldcharlie8
Tell me the years you rented out and the years you lived in it.
Posted on 1/23/21 at 5:44 pm to GoIrish02
quote:
Did you live there?
You replied to me, but you’re talking about OP. In my case, yes.
Posted on 1/23/21 at 5:44 pm to LSUtiger89
I'm sorry I hurt your feelings.
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
Posted on 1/23/21 at 6:05 pm to oldcharlie8
quote:If you claimed depreciation from your original $80k cost basis for the years that you rented the house out, that means you'll likely have capital gains (income) upon the sale of the house unless you've made significant capital improvements to your property (which might increase your cost basis and thus decrease your capital gain) while you rented it out.
Bought for 80 and sold for 80
Since you can't claim depreciation for the land the house is built on in most cases but only on the structure itself, the cost basis post-depreciation is unknowable without additional information about your acquisition transaction.
So, again, get a tax person to help you with your tax return.
Posted on 1/23/21 at 6:50 pm to oldcharlie8
quote:
Sold for 80k. Owed 50k. Paid off the 50 and banked the rest.
You are good, no capital gains tax.
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