jerry2000
Alumni

Deductions & credits

No, you are not. The ability to defer capital gains by buying another house was removed from the tax code in 1997 by the Taxpayer Relief Act. Since that time, you can not defer capital gains on a home by buying one of equal or greater value. What you can do, if you owned and lived in the home for 2 of the 5 years ending on the sale date, is to not have to pay tax on a gain of up to $250,000 (Single), or $500,000 (Married Filing Jointly). Note that if you ever used the home as a rental, then the exclusion does not apply to any gain equal to the depreciation that you claimed or could have claimed.

For further info, see IRS Pubs, 530, 523, and 17

http://www.irs.gov/pub/irs-pdf/p530.pdf

http://www.irs.gov/pub/irs-pdf/p523.pdf

http://www.irs.gov/pub/irs-pdf/p17.pdf


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