2014 Federal Income Tax guidance
Any help out there would be appreciated. I am currently traveling full time with my family for a year now. We sold our house LAST year and bought a fifth wheel and truck to start our adventure. We are...
Forum Discussion
4X4Dodger wrote:
If I am not mistaken isnt that tax exemption for capital gains ONLY if you re-invest the money from the sale in another house you will occupy?? I'd check that out.
You're about 10 yrs behind. the tax law was changed many yrs ago to remove the previous requirements about reinvesting the gains in a new house, and the one time only restriction.
For many yrs you have been entitled to this tax exemption on your principal home, up to 500,000/250,000 as long as you owned & used the home as your principal residence for at least 2 of the last 5 yrs. There is no requirement that you do anything specific with the proceeds, you don't need to buy a new house to qualify, and you are entitled to repeat this as many times as you qualify. So, theoretically if you buy low & sell high, you can make $250,000 as a single, tax free every 2 yrs, continually flipping your primary residence. It's one of the best deals in the whole tax code for those in the right market, that don't mind taking the risk and changing homes.
Edit: it was actually the Taxpayer Relief Act of 1997 that made those changes
