My Capital Gains On Sub2 Residence

How do I compute capital gains on a home that I've lived in for 2 of the past 5 years and had obtained in a subject to transaction?

Thanks!

allcash

Comments(3)

myfrogger29th December, 2003

You have zero tax liability since you lived in the residence for 2 of the last 5 years as long as your gain is not over $250,000 (or $500,000 if married).

Is the reason you are asking because you are approaching that number?
nlsecor29th December, 2003

I agree. If you are over 250k, the deed should have had a transfer amount. Sub2 financing+cash to seller. Add fixup and other expenses to bring it to current condition and you have your cost basis
sale price- commissions-cost basis=profit
profit-250k=taxable income

again, 500k if married.
[addsig]
AllCash4Homes29th December, 2003

Thanks! I was just unsure about the basis. That explains it well.

Happy holidays and investing all!

allcash