topic I have a plan to sell my single family home and will buy a downsized home. in Get your taxes done using TurboTax

I have a plan to sell my single family home and will buy a downsized home.

Atsuko717 — Fri, 04 Dec 2020 20:52:00 GMT

However this single family home has been rented recent these 5 years. We lived the home more than 15 years before we started to rent.
We claim tax as married couple.
Will you give me lists of ways to avoid huge tax when we sell our home.
Thanks

Re: I have a plan to sell my single family home and will buy a downsized home.

Critter-3 — Fri, 04 Dec 2020 21:35:57 GMT

There is no way to avoid the capital gains since it has been a rental for 5 years or more and you must recapture the depreciation you had to have been taking all these years. If you have not been taking depreciation then RUN to a local tax pro to get the 2020 return completed and fix that error ... it is not a DIY situation.

Re: I have a plan to sell my single family home and will buy a downsized home.

xmasbaby0 — Fri, 04 Dec 2020 21:39:15 GMT

Since you have not lived in the house for five years (or more) you cannot get the exclusion for the home being your primary residence for two out of the past five years. And buying another house--more or less expensive--makes no difference. The last time purchasing another home to avoid capital gains mattered was in 1997. See a tax pro for help with this.

Re: I have a plan to sell my single family home and will buy a downsized home.

NCperson — Fri, 04 Dec 2020 22:34:01 GMT

there is one more way to avoid the tax, and I am not being sarcastic..... live in it for the next two years. :(