Best strategies to avoid the Capital Gains hit for Selling and Buying 2-Homes within a 2-year period.
This calendar year of 2021, we have some tricky tax situations that need navigated.
- Lived in mountain home from 1994 to 4/2019, I bought for $140K.
- On 2/2019, we bought new for $577K, Hemlock Broomfield.
- On 6/1/2019, we leased the mountain home until 3/31/2021, trying to sell to meet the 2 of 5-year rule.
- We sold Mountain home on 5/28/2021 for $565K.
- We used proceeds to buy future downsize home in 55+ HOA, to use as Rental until we were ready - Curtis, Broomfield for $455K - purchase date 6/11/2021 and signed 1-year lease starting 7/1/2021.
- Wife fell in love the idea of no more yard work and want a larger place in the 55+ community and we bought one for $625K for Primary Residence Carla, Broomfield, purchased on 8/10/2021.
- Finally, we sold or Hemlock, Broomfield home for $790K on 9/8/2021 and moved to Carla home for permanent residence.
- Side notes, only Rental period for mountain home ever was time we moved to Hemlock home.
- At mountain and hemlock home, I ran Schedule-C business from home office for close to 15-20 years, need to look back and count depreciation's taken.
"Exchange", not sure about this, did buying the 2 other homes benefit?
Bottom-line, the home I owned for 27-years was converted to Rental on the 25th year and we only sold to avoid paying capitol gains outside the 2-of-5-year rule, because we decided we would not move back into it the future.
FYI, our married tax rates are for combined incomes close to $250K a year.
Thanks ahead for any discussion or advice on this.
