How to Save on Income Taxes When Selling Your Home

Posted by on April 1, 2016 · Leave a Comment 

Capital gains taxes are some of the highest taxes that you can pay. If you are planning on selling a home, you may be in for a shock with the amount of tax you owe from the sale of a home. Fortunately, if you are selling a residence that you own, there are ways that you can decrease the amount that you owe in taxes. Here are some ways to cut the amount that you owe in taxes after netting a home sale.RealEstateSelling

Own and Live in the Home

In order to deduct the amount of a home sale up to one half of one million dollars, you must own and live in the home. You must live in the home for two years prior to the sale to utilize this deduction. You must also own the home for at least two years in order to write off the amount of the sale. If you are planning to sell one of your residences at some point in the future, set up inside of the unit as your principal residence for at least 24 months. This will allow you to sell off the unit without potential major tax issues.

Save by Being Married

If you are married, you can write off up to $500,000 on a home sale. If you are a single person, you can write-off at least $250,000 for the sale of your home. If you are already planning to get married, you should have the wedding first and then subsequently make the sale once you can file jointly to save as much cash as possible.

Image credit: woodleywonderworks

Filed under Real Estate · Tagged with

About adminjian

Speak Your Mind

Tell us what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!

  • Huddleston Tax CPAs / Huddleston Tax CPAs – Bothell
    Certified Public Accountants Focused on Small Business
    19125 N Creek Parkway #120 / Bothell, WA 98011
    425-242-3836

    Huddleston Tax CPAs & accountants provide tax preparation, tax planning, business coaching,
    QuickBooks consulting, bookkeeping, payroll, offer in compromise debt relief, and business valuation services for small business.

    We serve: Tukwila, SeaTac, Renton. We have a few meeting locations. Call to meet John C. Huddleston, J.D., LL.M., CPA, Lance Hulbert, CPA, Grace Lee-Choi, CPA, Jennifer Zhou, CPA, or Jessica Chisholm, CPA. Member WSCPA.