Sale of second home

[DC6]

My husband and I purchased a second home in June, 2019 and we are looking to sell it in the next few months. We are not using it as a rental, one of us has been living in it. It was purchased below market value and we have done some much needed repairs. What are the tax consequences if we are able to clear $10 to $25 thousand on the sale? Will it be capital gains? If I stay in it for two years will that negate the capital gains?

[DoninGA]

The capital gains exclusion is only for your primary home.  The sale of the second home with a gain on the sale is subject to capital gains taxes.

Gain or Loss on a Home Sale = Selling Price (-) Selling Expenses (-) Adjusted Basis (Purchase price plus cost of improvements prior the sale)

[Anonymous]

you can only have one principal residence at a time.   

since you are married, the law also requires both of you to occupy the house as your principal residence for 2 years.  

it is entirely possible that if you do not have other substantial capital gains and qualified dividends in the year of sale, the gain on the sale of the house could be taxed at 0%

state taxes are a different matter. 

what you clear on the sale may not be the gain.   when people say clear, they're using talking about the cash they walk away with after paying closing costs. certain prorated expenses and paying off  the mortgage.   the mortgage does not figure in the gain.  since you say it wasn't rented, then gain should be the selling price less closing costs less basis (acquisition costs + capital improvements made)                                       

[supervilas]

I sold my second home at a loss and I did spend money to upgrade to sell the property. Do I get any deductions on money I spent

[DoninGA]

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@supervilas wrote:

I sold my second home at a loss and I did spend money to upgrade to sell the property. Do I get any deductions on money I spent

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No, there are no deductions on a tax return for the improvements or expenses you paid for the personal residence.  Improvements are added to the basis of the home.

Gain or Loss on a Home Sale = Selling Price (-) Selling Expenses (-) Adjusted Basis (Purchase price plus cost of improvements prior the sale)

[OLDMAN90]

I GOT A 1099-S FROM THE TITLE AGENCY FOR THE SALE OF MY SECOND HOME.   HOW DO I REPORT IT ON DELUXE TURBOTAX

[OLDMAN90]

THE ANSWER DID NOT TELL ME ANYTHING. I HAD THE SECOND HOME FOR 30 YEARS FOR VACATIONS. I NOW SOLD IT. HOW DO I REPORT IT????

[DoninGA]

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@OLDMAN90 wrote:

I GOT A 1099-S FROM THE TITLE AGENCY FOR THE SALE OF MY SECOND HOME.   HOW DO I REPORT IT ON DELUXE TURBOTAX

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To report the sale of a Second home you will need to upgrade to the Premier online edition.

To enter an investment sale other than from a brokerage account (1099-B), follow the steps below.

• Click on Federal Taxes (Personal using Home and Business)
• Click on Wages and Income (Personal Income using Home and Business)
• Click on I'll choose what I work on (if shown)
• Under Investment Income
• On Stocks, Mutual Funds, Bonds, Other, click the start or update button

Or enter investment sales in the Search box located in the upper right of the program screen. Click on Jump to investment sales

On the next screen, click Yes

On the next screen, click No

On the next screen, choose Second home and continue with the section until it completes.