Posted by Merez(IA) on September 05, 2005 at 12:52:05:
Okay, I’ll try to make my previous post a bit clearer. There were two gain exclusions that apply/applied to primary residence property. The roll over rule, which allowed for rolling over the equity from one property to another. This rule was ended in 1997.
What took it’s place is the 250k/500k (single/married) gain exclusion if you lived in the property for 2 of the past 5 years. However, in certain cases you may be able to prorate the gain exclusion, publication 523 has much more detail (it can be found at Publication 523 (2022), Selling Your Home | Internal Revenue Service)
A lay off from work as well as a move to another state for another job would most likely qualify for proration; however, consult with your own tax preparer as to the specific facts in your case (basically, I don’t know the specifics of your situation, so I can’t offer specific advice, just point you to the resources and talk about the rule in general).
How long did you actually live in the house? The exact number of days will be needed to know the amount of the exclusion proration.
Is there a capital gain if I bought a home at 350k and it appreciated 200k and I sold that home less than 2 years and transfered the gain to a home that cost more than 350k? Basically moving up. Will I be taxed because it less than 2 years? Does it also matter if the home is in one state (AR 350k) and transfer to another state (CA 500k+) after the sale?
What was the purposes of the property? - Posted by Merez(IA)
Posted by Merez(IA) on September 04, 2005 at 21:13:43:
Well, if it was a non primary residence (think vacation home or investment/rental property), you’re subject to the gain unless you did a 1031 exchange.
However, if it was your primary personal residence, you may qualify for a prorated portion of the 250k gain (which works out to $342.47 of tax free profit per day per person) exclusion based on why you sold it. You’ll want to check publication 523 (which you can find on www.irs.gov) for details. In summary, it is available if the move was made due to health, work, or other unforeseen circumstances.
The old roll over rule which allowed moving the equity from one property to another, which is what I think you are mentioning was changed in 1997.
This is a primary residence. The profit will be less than 200k. The move will most likely due to work laidoff. The roll over rule does not applied from lower cost home to higher cost in less than 2 years without capital gain tax implication? Publication 523 will explain the roll over rule? any info would help