Is this residence transfer tax-free?

No. It seems to me that all the "normal" LTCG bracket rate apply to unrecaptured section 1250 gain, plus another bracket at the top, at 25%, when the income of the taxpayer pushes the unrecaptured section 1250 gain above the top of the "regular" - i.e. *lower* LTCG rates.

It is very difficult to explain how this "maximum" rate works. I've tried several times, and am not yet satisfied with my results.

The 25% rate is not *the* rate, it is the *maximum* rate...

Reply to
lotax
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That is what I used to think, but quickly running the numbers on the tax forms tells me otherwise. As does IRC section 1(h)(E)(i).

Maybe when this was implemented, 25% was the max LTCG rate?

Reply to
Taxed and Spent

Yes. I quoted you, and you made the error in this code section.

Reply to
Taxed and Spent

Reply to
lotax

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