Death and Taxes are an inevitable reality to life – but although facing taxes when you sell your home is a stark reality, understanding how to lower your tax bill during the process could leave money in your pocket to finance a trip for you or your entire extended family! It could also increase your nest egg to enjoy in the decades to come.
The bottom line is you must pay taxes for the profit you incur when you sell. However, shrinking the difference between your cost basis (what you purchased for your home originally) and the price when you sell could lower the bill substantially. For example, did you know that you can add the cost of all the remodeling in the kitchen or bathrooms to your cost basis? Your new roof counts, as does the landscaping.
If your capital gain is $250,000 or less, you don’t have to pay any taxes – and double that amount if you are married. Make sure you’ve owned your home for two years and lived in it for 24 months over five years.
A senior’s home is often their most significant investment, and being financially prudent makes what you have last longer. If you want to learn more about the financial advantages of tax savings when downsizing, and view a sample tax bill to make it easier to understand, follow this LINK to an article well worth reading. Then, get back to house-hunting for that smaller place!
For a confidential complimentary consultation on your home’s value in today’s Sellers Market, please contact Amy Lance with Atlanta Fine Homes Sotheby’s International Realty: (404) 550-2608 or [email protected]. She works with Buyers, Sellers, and Investors!