FAQ Friday: Capital Gains
Friday, November 21st, Attorney, Paula Mattson-Sarli talks about capital gains tax exemptions and exclusions.
Upon the sale of your home you may receive a 1099-S which shows the proceeds from the sale of your home.
A married couple that used this home as their primary residence for two of the last 5 years can exclude up to $500,000 of any gain. However, if the home is chosen to be sold after the death of one of the spouses, it must be sold within 2 years and not re-marry in that time. If the above isn’t followed, then $250,000 can still be exempted.
We always suggest getting date of death values. Upon the death of one spouse, an appraisal should be done right away to assist with tax purposes. An appraisal may be foregone if they plan to sell very quickly after death.
If someone inherits the house, for example the children after both deaths of the parents then it would be very unlikely capital gains would be an issue since in this case it automatically goes to date of death value.
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