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Posted by James Lewis on June 3, 2007, 10:30 pm
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> I have the following tax-related question to the gurus out
> here. Situation is as follows: 1/2 of duplex is used as a
> primary residence, 1/2 is rented to a tenant. If the duplex
> is sold (estimated sales value $220k), what will the taxes
> be on this sale? The duplex was purchased about 7 years ago
> and will be sold as a part of divorce settlement, if that
> matters.
If the half of the duplex you lived in was your primary
residence for no less than 2 of the last 5 years before
sale, any gain up to 250,000 if single/500,000 if married
filing joinly in the year of sale. The other half, assuming
the cost minus depreciation on a straight line basis is less
than proceeds on the rented half (ie, you prorate the sale
based on a reasonable formula) is a passive income capital
gain which helps use up any PAL carryforwards.
Mike
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