Need Help On First Home Sale
Not sure if I'm even posting this in the right spot or not, but here goes...
My wife and I bought a home in June 2003 for a steal. We are planning on selling it before the end of this year, and use the gain on the sale to purchase two homes, a primary residence, and a rental/summer home.
Someone told us that there are big time tax penalties if you sell you home within the first two-years, and told us to wait at least that long before we sell.
So the question is, Am I going to suffer huge big time tax penalties if I sell now? If I make a like kind investment in the grace period, will I escape the capital gains on profits?
Any advice, or some suggestions would be greatly appreciated!
I would definitely consult your CPA but I believe you need to live in a residence for 2 years to avoid this tax. The question is to weigh the cost of paying the tax vs. the profit you will make. There is also a different tax rate if you sell in less than a year vs. holding at least a year. Your CPA will be able to advise you. Good luck.