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When would I need to sell to avoid paying capital gains?
I lived in a condo from 2018-2023 but then moved out and have been using the property as a rental. How soon would I need to sell it to avoid paying the capital gains tax in Florida? The property is worth $160,000 currently, the property was put in my name by a relative that paid $90,000 for it.
Asked By Danielle | Saint Petersburg, FL | 438 views | Selling | Created 1 year ago
Answer(5)
Amanda Courtney
REP Realty Group
For a primary residence, you generally need to have owned and lived in the home for at least 2 of the last 5 years before selling to exclude up to $250k in gain ($500k if married filing jointly). Investment properties don’t qualify, but a 1031 exchange can defer taxes. Talk to your CPA for your specifics and timing.
- 1 week ago
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Chaimae Yaagoubi
Keller Williams Wellington
To potentially avoid paying capital gains tax, you need to have lived in the home for at least 2 of the last 5 years as your primary residence. If you meet that rule, you can exclude up to $250,000 in profit if you're single, or $500,000 if you're married filing jointly. There are exceptions, but that’s the general guideline. It’s always best to double-check with a CPA or tax advisor before selling, just to be sure how the rules apply to your specific situation.
- 3 months ago
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Chad Basinger REALTOR, CPA, CFP,
eXp Realty of Southern California, Inc.
Hello Danielle,
It is great to see you being proactive and considering tax ramifications. I am a REALTOR, who also has an active CPA license and CFP certificate. When it comes to capital gains taxes and real estate, as long as you have lived there for 2 of the last 5 years, you will be able to take advantage of the $250,000 capital gains exemption amount. In this case, your gains are well below the 250K amount, so would not have any capital gains taxes at this stage. To answer your question regardless of this, the 2 out of 5 year requirement would be met as long as you close on that property in 2027 (specific date depends on when you moved out of it). Good luck!
It is great to see you being proactive and considering tax ramifications. I am a REALTOR, who also has an active CPA license and CFP certificate. When it comes to capital gains taxes and real estate, as long as you have lived there for 2 of the last 5 years, you will be able to take advantage of the $250,000 capital gains exemption amount. In this case, your gains are well below the 250K amount, so would not have any capital gains taxes at this stage. To answer your question regardless of this, the 2 out of 5 year requirement would be met as long as you close on that property in 2027 (specific date depends on when you moved out of it). Good luck!
- 1 year ago
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I would speak to a CPA but a 1031 exchange may be suitable here
- 11 months ago
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