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How long do uhave to own ur primary residence...

Discussion in 'Other Off Topic Forum' started by ttforcefed, Sep 23, 2004.

  1. ttforcefed

    ttforcefed F1 World Champ
    Rossa Subscribed

    Aug 22, 2002
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    in order to pay long term taxes as opposed to short term when you sell? is it like 2 years or something?
     
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  3. Mike360

    Mike360 F1 Rookie

    Feb 18, 2004
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    Sydney, Australia
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    Mike
    Are you talking about New York or London?
    Shouldnt this be in the business/investment forum???
     
  4. thadbrown

    thadbrown Karting

    Nov 3, 2003
    229
    i believe you have to be there 2 years to pay long term
     
  5. ttforcefed

    ttforcefed F1 World Champ
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    Aug 22, 2002
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    US thanks...this is neither business nor investment...primary residence is a consumption item if u ask me...
     
  6. mprogge23

    mprogge23 Karting

    Aug 29, 2004
    98
    Boca Raton, Fl
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    Matt R.
    if you own any capital asset for over 12 months, it will qualify for long term cap gains. As for primary residents you have an exclusion that is available only once every 2 years, meaning you have to be in the house for at least 2 years, you can exclude the first $500,000 of capital gain if you are married and filing jointly.
     
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  8. SrfCity

    SrfCity F1 Veteran

    Nov 1, 2003
    9,842
    Orange County, CA
    $250K for single.
     
  9. PeterS

    PeterS Four Time F1 World Champ
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    I am struggeling with this right now with a rental in town. If I change it to my primary residence for two years, I can sell it and pull up to $250K tax free, or about $1800 a month for the 24 months I am there.
     
  10. LetsJet

    LetsJet F1 Veteran
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    May 24, 2004
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    I believe you must live in the house two out of the last five years. So, it dosen't have to be the last three years. If this was a primary residence before you rented it, this might work to your advantage.
     
  11. Speed Racerette

    Speed Racerette Formula 3

    May 24, 2004
    1,319
    Dallas, TX
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    She wants Revenge

    This is correct...I exercised this option on one of my rental houses in San Francisco. The rule is that the property has to have been your primary residence 2 of the past 5 years. I lived in it in 1999,2000 and rented it out in 2001, 2002, and 2003. Sold it and paid no capital gains on the first $250k in profit (limit is $250k if you are single, $500k if you are married, filing jointly.) The gain calculation is after paying real estate agent fees so it is a pretty sweet tax deal.
     
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  13. LetsJet

    LetsJet F1 Veteran
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    May 24, 2004
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    Yes it is, except if you have already reached the $500K gain and don't want to move. So do you do the fiscally responsible thing and move to adjust your basis or take the cap. gain hit when you do eventually move?.....what to do... what to do?
     
  14. Speed Racerette

    Speed Racerette Formula 3

    May 24, 2004
    1,319
    Dallas, TX
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    She wants Revenge
    I'm assuming that you are saying that you already took the gain exemption within the past 2 years already? If it has been less than 12 months, you will pay your ordinary tax rate for the additional capital gains, if it is between 12 months and a year, you will pay 15% capital gains tax.

    I don't understand your questions about moving to adjust your basis....the basis for the home you are considering selling doesn't change whether you live in or not. Unless you are going to move in and spend $ on improvements. Maybe I am not understanding your question?
     
  15. LetsJet

    LetsJet F1 Veteran
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    May 24, 2004
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    Reread it......... They were not questions to you. I was just thinking "out loud" and stating that the market value for my house has put me in this position. I fall within the guidelines of the gain exemption. I just have a decision to make........... Thanks for your response......... What I meant by "adjusting basis" (using the terms loosely), is that if I purchased another home now, I would step up the "basis" to the purchase price.
     
  16. Speed Racerette

    Speed Racerette Formula 3

    May 24, 2004
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    She wants Revenge

    Aaaaahhh. Thinking out loud. I get it :). I was thinking "dang, if he's already used up the full exemption already and still has more to gain...that's not a bad place to be in!"
     
  17. LetsJet

    LetsJet F1 Veteran
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    May 24, 2004
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    There are worse places, I agree..........
     

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