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Moving On Up!
Moving On Up! - Capital Gains When Selling Your Home -
69% of people in the United States own their own home. One question I am often asked when a homeowner is considering selling their home is the amount of taxes they will be liable for on the sale.
The good news is that if you have lived in the house for 2 out of the last 5 years, making it your primary residence, you can claim an exempt from capital gains taxes up to $250,000. for single filers and $500,000 for joint filers.
The really good news is that you can claim this exemption every 2 years!
Think about this for a minute. Suppose you sell your home for $300,000. You use $100,000 to pay off the remaining mortgage, leaving you with $200,000.
You can then buy another home for $450,000 using $90,000 for the down payment, 30 year conventional loan @ 5%, and pocket the remaining $110,000. That's a nice way to move up in the world.
And in 2 years, you can do it again!
Why do people do this? People do this to move to larger homes as they require more space. They do this ... more
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