What happens if I sell my residence after 5 months?
August 15, 2005
Date: Wed, 13 Jul 2005
If I sell my home, which I bought 5 months ago, do I owe capital gains tax? This is my primary residence. I been living in the home since I bought it in February, 2005. The gain is less than $250,000.
I just want to move to a nicer place.
Date: Mon, 08 Aug 2005
Since you haven't owned the home and used it as your principal residence for more than two years, and there is no "reasonable cause" exception that applies in your situation, any gain will be taxable income. If you don't own the home for more than one year at the time the sale closes, any gain will be taxable as a short-term capital gain at your highest marginal tax rates.
We have more answers to frequently asked real estate tax questions! We also offer up-to-date information about new tax real estate tax developments in Michael Gray, CPA's Real Estate Tax Letter.
Find us on Facebook
Follow me on Twitter
Connect on LinkedIn
Connect on Google+