Closing Cost - Posted by Dara

Posted by Tim Fierro (Tacoma, WA) on January 31, 2002 at 21:21:35:

  1. It is negotiable on who pays.

  2. Someone will need to pay for excise tax, title work, court filings, etc… IE: There are some fees that are part of buying and selling a property.

  3. I am not an accountant, nor qualified to answer tax questions.

Closing Cost - Posted by Dara

Posted by Dara on January 31, 2002 at 21:09:26:

I live in Ohio.I bought a House which I live in with my family in October 2001(3 Months Ago)for $131,000.The House needed some repairs and all the repairs we did in the house was close to $8,000.Last week,I got a job out of state and will need to move.One of our family friends was interested in the house and we agreed on $145,000.
My Questions.
First,is closing cost always the sellers expenses?
Secondly,is there a way to sell the house to avoid closing cost?
Thirdly is there going to be any penalty or tax disadvantage on selling the house so soon and for the price of $145,000?
Please I will like all 3 questions answered.
Thank You so much.

Re: Closing Cost - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on January 31, 2002 at 21:29:42:



As this is your own residence, you qualify for an exclusion on the capital gains tax when you sell the property.

Oh, I am not an attorney or a CPA.

Normally, one has to live in the house a total of 24 months in the 5 years before the sale date to get the exclusion. HOWEVER. There is a special exception made for those people who must move because because of a change of job location. You will get a pro-rated exclusion of the federal capital gains tax. You probably better talk to a CPA to get the exact details.

Another thing, the fix-up costs, materials and other people’s labor costs – not your own labor-- is added to the “basis” of the property. You subtract the basis from the net selling pric – after taking off the costs of selling – to get the gain. Actually, any fix up costs incurred shortly before selling the property–within 90 days, I think–can be deducted from the gross selling price to reduce the net selling price. Or at least they used to be deducted before the capital gains exclusion rule changed. That may have changed. Again, I suggest professional advice.

Good InvestingRon Starr********