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November 22, 2019
Question

Developing and splitting land next to primary residence taxes?

  • November 22, 2019
  • 1 reply
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My wife and I have lived on our property for 15 years and would like to divide it in half and build two larger new homes. One to replace our residence and the other to cover the cost of construction and dividing. In our budget the net after costs is near zero, but as one house is sold and we plan to grow old in the other what is the tax issue we might face?

    1 reply

    November 22, 2019

    Go to a tax pro for this....you will need to split your basis in the land between your current main home and your new main home and the home you're building to sell.....you get the home sale exclusion for your current main home and will have to pay capital gain tax on any gain on the sale of the home you are building to sell.