topic House sale in Deductions & credits

House sale

Phillyeagles — Thu, 01 Oct 2020 15:18:20 GMT

Hi,

I bought a house in philly for my brother and sold it recently and the profit was 45k. It was not my primary residence. do i have to pay taxes on that amount and how much?

Re: House sale

Bsch4477 — Thu, 01 Oct 2020 15:56:49 GMT

Long term capital gains tax depends on your income bracket but is generally 15%. I assume that you took into account any capital improvements you made in calculating your profit. I also assume you did not rent the home which would raise other issues such as recapture of depreciation.

Re: House sale

Phillyeagles — Thu, 01 Oct 2020 17:34:33 GMT

would capital gains apply because i didnt live there . i let my brother live there. i paid 8k for new bathroom and also 22k for a guy to make improvements. paid him 150 a week.

Re: House sale

Bsch4477 — Thu, 01 Oct 2020 17:40:13 GMT

What matters is whether you made a profit. The expenses of capital improvements is added to your cost basis (what you paid for the house) which in turn decreases your taxable profit.