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Is capital gain tax charged?

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ukrkoz
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Is capital gain tax charged?  Reply with quote  

Hi all

Is capital gain tax charged if ALL proceeds from a property sale are rolled into a new, larger mortgage? As in - property is paid for, new mortgage assumed for a larger property, current property sold, all $$ rolled into the new mortgage.
Thank you
Post Sat Jun 07, 2014 1:41 am
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braje
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Is this your primary residence? If so gains up to 250000 for single and 500000 for mfj are not taxed
Post Mon Jun 16, 2014 7:07 am
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braje
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Is this your primary residence? If so gains up to 250000 for single and 500000 for mfj are not taxed
Post Mon Jun 16, 2014 7:07 am
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Wino
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First off, you must figure your capital gains. For instance, let's say you bought a primary residence for $100K. You made $20K in improvements, and you sold it AT LEAST 2 years later for $200K. You have a capital gain of $80K (200 - 100 - 20).

You must invest that $80K in another primary residence within 2 years (three years if you're building a new place). The original $120K is already taxed, and does not count as a capital gain, because it is merely replacing your already-spent capital. You can do whatever you want with that amount.

Any amount you DON'T reinvest in a home (of the $80K gain) is subject to long-term capital gains, which is at 15% this year.

Hope this helps.
Post Mon Jun 16, 2014 5:12 pm
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Wino
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The exemptions mentioned earlier are lifetime exemptions. They should be used late in life when you downsize for the final time, and not early just to avoid the 15% rate. Chances are, your regular income tax rate is higher than the capital gains rate.

Keep reinvesting the profits until near retirement, at which time you downsize and take the exemption.
Post Tue Jun 17, 2014 5:13 pm
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blixet
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You don't have to buy another home with the proceeds of the sale and there is no limit on the number of times that the exclusion can be used as long as you meet the qualifying criteria.

See: http://www.irs.gov/pub/irs-pdf/p523.pdf

Information is more valuable sold than used ‚Äď Fischer Black
Post Tue Jun 17, 2014 11:00 pm
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Wino
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quote:
Originally posted by blixet
You don't have to buy another home with the proceeds of the sale and there is no limit on the number of times that the exclusion can be used as long as you meet the qualifying criteria.

See: http://www.irs.gov/pub/irs-pdf/p523.pdf

I stand corrected. Thanks, blixet.
Post Wed Jun 18, 2014 5:09 am
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Bradford
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Capital gains tax?
Can anyone tell me what rate capital gains tax is charged in percentage in the UK?

Also is this example liable for capital gains tax?

Our house is valued at £115,000 but sells for £130,000?
Post Fri Mar 13, 2015 5:26 pm
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oldguy
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ukrkoz - to further clarify, the mortgage doesn't come into play.
Post Fri Mar 13, 2015 5:38 pm
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losangelescpa
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Capital Gains Tax is a tax on the profit when you sell (or Ďdispose ofí) something (an Ďassetí) thatís increased in value.Capital gains are profits from the sale of a capital asset, such as shares of corporate stock, a business, a parcel of land, or a piece of art. Capital gains are generally included in taxable income but are often taxed at a lower rate; under current law, for example, most long-term capital gains face a top rate of 15 percent. Complicated rules impose a range of tax rates on different kinds of gains and can make it difficult for taxpayers to calculate their tax liability. Itís the gain you make thatís taxed, not the amount of money you receive.
Post Thu Mar 19, 2015 11:29 am
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