It depends. You are building your house this year but are going to sell it next year. This is considered an investment sale in 2022. You will report this when you sell your house in 2022. You report nothing in 2021.
To give you a heads-up, your complete costs in building your house will be treated as a cost basis. The amount you sell your house will be proceeds. The difference between your proceeds and your cost basis is a capital gain.
To offer sound tax advice, I would consider waiting at least one year between the time you finish your house until the time you sell because of the nature of capital gain tax. Once complete, if you sell your house within one year, you are subject to short-term capital gains tax. However, if you wait longer than 1 year, you may be taxed at a more favorable long term capital gain rate.
Please review this Turbo Tax post for more details.
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