Question

Property gains taxes

Forum|Forum|3 years ago
November 16, 2022
1 reply
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I am retired, I own my home, but I have been renting out my house while I travel. If I sell my house, how quickly does that money need to be reinvested in real estate before I have to pay capital gains taxes?

mikafeed58

The IRS has a provision for the sale of your Primary Home. If you have lived in the home at least 2 of the past 5 years, you can exempt up to $250,000 for Single Taxpayers or $500,000 for MFJ. Net Profit above those thresholds are subject to Capital Gains Tax. However, if you are subject to Capital Gains, you can avoid them by reinvesting the proceeds within 180 days. This is know as a Temporary Tax Deferral.

IRS Topic 701 should answer any other questions you may have regarding the sale of your personal residence:

https://www.irs.gov/taxtopics/tc701

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