What do you mean by if you qualify for the home sale exclusion then that amount is not part of total taxable income.
- The amount of gain excluded from gross income with respect to any sale or exchange of a principal residence is limited to $250,000.
- In the case of a husband and wife who file a joint return for the tax year of the sale or exchange of the property, the $250,000 limitation (described above) that applies to the exclusion of gain from the sale or exchange of a principal residence becomes $500,000
- CA Sale of a Principal Residence Page 2
I thought that once a sale exclusion was applied to capital gains from sell of a home.
- Yes, the exclusion is applied prior to calculating the tax.
The remaining amount would be categorized into a tax % bracket based on income amount. And taxed at 13.3% as ordinary taxable total income if amount was over $551,000.
- No it will not be taxed at a flat rate of 13.3%
- California taxes capital gains at the same rate as regular income. In turn, any money earned in a year from investments will simply be added to the person's taxable income.
- No, you do not pay a flat 13.3% on your home sale.
Would an income bracket be used on this capital gain as ordinary income or not? If so, what would it be? And what tax rate would this amount be taxed at in 2017?
As a reference, what information chart or table are you using to determine percentage rate and tax brackets on longterm capital gains?
- Using the table provided by @DMarkM1
- $0.00+ 1% The first $8,223 is taxed at 1%.
- $8,223.00+ 2% From $8,223.01 to $19,495 is taxed at 2%.
- $19,495.00+ 4% From $19,495.01 to $30,769 is taxed at 4%.
- $30,769.00+ 6% And so on.
Where can I find a 2017 tax chart regarding rates and tax brackets on the IRS website?
- It is not on an IRS website, it is California.
- The website below has the same info as provided by @DMarkM1, but in a table form. if you scroll down to your taxable income number it will give you the proper tax.
- CA 2017 Tax Table for 540 Tax Return
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