capital gains tax question

[kmrau0130]

When we sell our home we are expecting to have about $200k in profits, we live in Michigan, do we have a limited time to re-invest this money?  Can we use that to purchase land or just another home in order to avoid the capital gains tax?

[xmasbaby0]

The last time purchasing another home to avoid capital gains on a federal tax return was possible was in 1997.  That law changed years ago.

SALE OF HOUSE

If your gain was more than  $250,000 filing Single, or more than $500,000 filing Married Filing Jointly the sale must be reported on your tax return.  Whether you re-invested the gain in to another house is irrelevant.  If you  have a Form 1099-S go to Federal>Wages and Income>Less Common Income>Sale of Home (gain or loss)

If you owned and lived in the home as your primary residence for at least 2 of the last 5 years on the date of the sale, you do not have to report the home sale if the gain is less than $250K filing Single, or less than $500K filing Married Filing Jointly (and you both owned and lived in the home for at least 2 years).

• If you are using online TT, you need Premium software to report the 1099-S

NOTE:   If you have ever used the home as rental property or claimed a home office, you have more information to enter

[Loretta P]

Congratulations on the upcoming sale of your home.  If you have owed and lived in your home for at least 2 of the last 5 years before the sale you can qualify for an exclusion of up to $250,000 for a single person and $500,000 for a married couple filing a joint return.  

How does selling a home affect my taxes? 

Tax Aspects of Home Ownership: Selling a Home 

Is the money I made from a home sale taxable?