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Tax consequences for buying and selling a home

Let's say you are over 55, married, no kids at home, and you sold your home in State "C" for $589,000 in September 2003. What would be the tax consequences for the following scenario:

  • After selling the home in State "C," you move to State "A" and buy a home for 5,000 (same month and year - 9/2003).
  • You are thinking of selling this home within six months, and it has probably appreciated to about 5,000.
  • What would be your tax consequences if you bought another home in a different part of town that is more expensive, say, 0,000? All homes were and will be owner-occupied.

Thank you for your time!

FE

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Reply to
FE
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Age is irrelevant to home sale taxation, and has been since May 1997.

Assuming you owned and occupied that home for at least two of the five years preceding the sale, and are filing a joint return, the first $500,000 of capital gain on that sale will be exempt from federal tax. Most (all?) states with an income tax conform to that, but double check on what the specific states in your scenario do.

No tax effect.

You will have a short-term capital gain of $140,000 ($425K - $285K) no matter what you do. Doesn't matter what the price of the new house is or if you even buy a new house. All that pre-1997 "defer taxes by buying something more expensive" stuff is dead.

-- Rich Carreiro snipped-for-privacy@animato.arlington.ma.us

Reply to
Rich Carreiro

These are not factors in figuring out the tax.

No tax consequences.

No tax consequences for thinking about it.

Again no tax consequences. No tax consequences if you keep buying real estates. Only if you sell them and realize gains.

Reply to
PeterL

$140,000 in six months? Impressive.

Taxable, too.

Reply to
Arthur L. Rubin

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