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Posted by garagecapital on June 12, 2007, 1:06 am
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I lived in a home for three years. I moved but kept the
house unoccupied except for two months I rented it out. I
returned to the house two years later. I sell it. Does the
fact that I collected rental income hurt my capital gains
exclusion on the sale of the house?
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Posted by Seth on June 18, 2007, 9:27 am
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> I lived in a home for three years. I moved but kept the
> house unoccupied except for two months I rented it out. I
> returned to the house two years later. I sell it. Does the
> fact that I collected rental income hurt my capital gains
> exclusion on the sale of the house?
There's depreciation during the rental period that has to be
recaptured.
Seth
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Bill on June 18, 2007, 9:27 am
Please log in for more thread options garagecapital@gmail.com (garagecapital) posted:
> I lived in a home for three years. I moved but
> kept the house unoccupied except for two
> months I rented it out. I returned to the house
> two years later. I sell it. Does the fact that I
> collected rental income hurt my capital gains
> exclusion on the sale of the house?
If I understand your facts correctly, you lived in the house
for 3 of the last 5 years. That qualifies you for the "main
home occupied at least 2 of last 5 years."
I would consider the 2 months of rental as incidental, as
long as you did not claim any depreciation in the year it
occurred. (You did, I presume, report the rental income as
"other income" in the year received, right?)
Thus, as long as your net profit on the sale of this
_qualified_ Main Home is less than $250,000 ($500,000 if
MFJ), there is no taxable gain and nothing to report.
Bill
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Bill on June 19, 2007, 9:29 pm
Please log in for more thread options garagecapital@gmail.com (garagecapital) posted:
> I lived in a home for three years. I moved but
> kept the house unoccupied except for two
> months I rented it out. I returned to the house
> two years later. I sell it. Does the fact that I
> collected rental income hurt my capital gains
> exclusion on the sale of the house?
If I understand your facts correctly, you lived in the house
for 3 of the last 5 years. That qualifies you for the "main
home occupied at least 2 of last 5 years."
I would consider the 2 months of rental as incidental, as
long as you did not claim any depreciation in the year it
occurred. (You did, I presume, report the rental income as
"other income" in the year received, right?)
Thus, as long as your net profit on the sale of this
_qualified_ Main Home is less than $250,000 ($500,000 if
MFJ), there is no taxable gain and nothing to report.
Bill
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Seth on June 19, 2007, 9:29 pm
Please log in for more thread options
> I lived in a home for three years. I moved but kept the
> house unoccupied except for two months I rented it out. I
> returned to the house two years later. I sell it. Does the
> fact that I collected rental income hurt my capital gains
> exclusion on the sale of the house?
There's depreciation during the rental period that has to be
recaptured.
Seth
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
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