what will I pay?
I have a second home I bought in Michigan on November 2003 for 164,900.00 I wish to move to another area and am thinking of selling. An appraiser said the house is now worth 199,900.00-190,000 I plan on using the entire amount towards my new home. What would I pay? I am also selling my primary home in New york for 600,000 I lived there for over 2 years, does that affect my sale in Michigan? Someone please help! 
From what I understand of real estate exchanges, you can sell the Michigan, and purchase a house of equal or greater value without having to pay taxes. The best advice that I can give you is to find a good attorney with experience in real estate exchanges.
As for your New York House, you might be able to save a lot on taxes because you lived there for two years. In North Carolina, single people can make $250,000 tax-free and married couples can make $500,000 off of the sale of a property that they lived in for two years or more. But, once again, find a good tax attorney or accountant.
[addsig]
Quote:I have a second home I bought in Michigan on November 2003 for 164,900.00 I wish to move to another area and am thinking of selling. An appraiser said the house is now worth 199,900.00-190,000 I plan on using the entire amount towards my new home. What would I pay? Your second home is not your primary residence, and the sale of this home would be subject to capital gains taxes appropriate for your holding period. Using all the proceeds of this sale to purchase a new home does not change your tax liability.
Quote:I am also selling my primary home in New york for 600,000 I lived there for over 2 years, does that affect my sale in Michigan? Someone please help!Let's assume that you meet the two year rules for excluding up to $250K of your profits from capital gains ($500K if MFJ). This capital gain exclusion is based solely upon the facts and circumstances of the sale of your primary residence. The sale of your second home in Michigan has no effect on your tax liability from the sale of your New York primary residence.
Whether you use none, some, or all of the proceeds of the sale to purchase a replacement property does not change your tax liability resulting from either sale.
IF I DO PAY CAPITAL GAINS ON THE MICHIGAN HOME WHAT AMOUNT IS TAXABLE AND HOW DO I FIND OUT WHAT % I WOULD PAY?
rule of thumb is 20% on gain meaning over and above purchase price and improvments other dedutions may apply. best to use an accountant
SHELLI,
You are taxed on your profits realized from the sale. If you purchased for $200K and sold for $300K, your taxable profit is $100K. If your holding period is less than one year, your tax rate is the same as your tax bracket. If your holding period is longer than one year, then your tax rate is determined by your tax bracket and the timing of your sale as follows:
For transactions on or after May 6, 2003 through December 31, 2007: The maximum long term capital gains tax rate will be 15%. For those in the 15% tax bracket, maximum capital gains rate will be 5%. On January 1, 2008, the 15% rate remains unchanged, but the 5% rate goes to ZERO for 2008 ONLY.
On January 1, 2009, the old 20% and 10% rates return.
Please consult your personal tax advisor for specific details for your situation.
[ Edited by DaveT on Date 06/16/2003 ]