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sjcha0512
New Member

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

 
13 Replies
xmasbaby0
Level 15

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

You can use TurboTax if you bought/ sold a home.  You may or may not even have to report the sale of the house--did you get a 1099-S?

If your gain was more than  $250,000 filing Single, or more than $500,000 filing Married Filing Jointly the sale must be reported on your tax return.  Whether you re-invested the gain in to another house is irrelevant.  If you  have a Form 1099-S go to Federal>Wages and Income>Less Common Income>Sale of Home (gain or loss)

If you owned and lived in the home as your primary residence for at least 2 of the last 5 years on the date of the sale, you do not have to report the home sale if the gain is less than $250K filing Single, or less than $500K filing Married Filing Jointly (and you both owner and lived in the home for at least 2 years).

* If you are using online TT, you need Premier or Self-Employed software to report the 1099-S.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
Ktj2424
New Member

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

I bought and sold a home in 2020. I lived in the home I sold for under 2 years, and most of the profit from my sold home went to a down payment on my new home.

 

The amount I “pocketed” was less than 20k.

 

Does the above still apply to me or do I need to wait to see if I receive a 1099-S?

Nm1771
New Member

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

We sold a home 2020 and bought one same day do we need to claimed it where we make under60,000 a year 

DoninGA
Level 15

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

The purchase of a personal residence is not reported on a tax return.

 

If you sold your primary personal residence and you lived in and owned the home for at least two years in the five year period on the date of sale, you do not have to report the sale if your gains are less then the exclusion amounts of $250,000 if filing Single or $500,000 if filing Married Filing Jointly (and both lived in the home for two years).

If you had a gain greater then the exclusion amounts then you would have to report the sale. Also, if you received a Form 1099-S for the sale either with a gain or a loss, the sale has to be reported. You will need the online TurboTax Premier or Self-Employed edition to report the sale if you are using the online editions. Make sure that you indicate that you want the sale of the home reported on your tax return.

 

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)
Scroll down to Less Common Income
On Sale of Home (gain or loss), click the start or update button

 

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

BarbaraHilson
New Member

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

I sold my home last year.  I am a widow. 

 

I am a Romance Scam victim.  He got all the money I had in all my accounts (they are now closed - no money) and I sold my home because he needed the sale money- he said he would pay me back.  Found out he was not really that person.  So the money I received back was also taken.  I filed report with the police, with the FBI - filled out their form, and with the FTC.  They are not able to take the case any further because he does not reside in this country.

So now I have to report the sale on money I do not have.  I read online if I received a 1099 from the mortgage company I would not need to pay taxes on it.

I need help please.

JohnB5677
Expert Alumni

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

If you sold your Primary Residence the sale may be exempt, the home must be considered a primary residency based on Internal Revenue Service (IRS) rules.

 

These rules state that you must have occupied the residence for at least two of the last five years.

 

The Internal Revenue Service (IRS) allows homeowners to exclude the first $250,000 ($500,000 for couples who own the house together and file jointly) of the gain from their taxable income, but in most cases, anything over that is taxable.

 

If you determine that you do not owe any tax you do not have to report it to the IRS.

 

I am so sorry for your circumstance.

 

 

 

 

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buenoshun
Level 2

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

How is the gain considered?

With or without closing costs?

I sold last year, my gain was $257k, and after closing costs it was $222k.

 

npierson7
Level 1

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

Closing cost should be added to your cost basis, in other words it reduces your gain on sale, because the basis is increased. 

JoeBlack99
New Member

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

"

If you sold your Primary Residence the sale may be exempt, the home must be considered a primary residency based on Internal Revenue Service (IRS) rules.

 

These rules state that you must have occupied the residence for at least two of the last five years."

 

This is only the case to get the FULL 250,000 exclusion amount.

If you lived in the house for LESS then two years during the last five year you will still be able to deduct partial amount per how many months you did live in it during those 5 years.

 

According to the IRS website https://www.irs.gov/publications/p523

 

Here is the easy math. But the form is below as well.

 You lived in the house for 6 months during the last 5 years.

6/24 x 250,000 = your exclusion amount = 62,500 as single filer. You made 70k off the sale after deducting all costs associated with the sale. = 8,500 is taxed.

 

Determine the shortest of the following 3 periods: 
 1. Your time of residence in the home during the 5-year period leading up to the sale_____
 2. Your time of ownership of the home leading up to the sale_____
 3. The time that has elapsed between the sale and the date you last sold a home for which you took the exclusion if you had done so_____
Step 2Take the smallest period from Step 1 (you may use days or months) and divide that number by 730 (if using days) or 24 (if using months)_____
Step 3Multiply the result from Step 2 by $250,000. Stop here if not married filing jointly_____
Step 4Repeat Steps 1–3 for your spouse and add the two results
Hal_Al
Level 15

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

@JoeBlack99  said

"If you lived in the house for LESS then two years during the last five year you will still be able to deduct partial amount per how many months you did live in it during those 5 years."

 

A partial exclusion, for living and owning less than the required 2 years,  is only allowed if you are selling because of a change of employment,  health reason  or unforeseen circumstances.  

Reference: https://www.nolo.com/legal-encyclopedia/the-partial-home-sale-tax-exclusion-irs-approved-unforeseen-...

pwe
Returning Member

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

My wife and I bought a condo at the end of June 2021 $900,000 and sold our home of 30+ years at the end of August 2021 for $1,600,000.  If the basis for the home sold is $600,000 ($300,000 purchase price and $300,000 improvements over the 30+ years) and qualify for the married exclusion of $500,000, would the capital gain be $500,000?  Is there anything I'm missing?  Can I apply the purchase price of the condo against the capital gain?  Any suggestions?

nerdindenial
New Member

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

I realize this is way late but I believe you are correct.

I have the same situation so I'm interested on how yours was filed.

Capital gain = 1600K - (300K+300K) = $1000K

Taxable capital gain = $1000K -500K = $500K

Now what is an improvement over 30 years? One exterior paint job? 3 Exterior paint jobs? Bathroom repair?

Maybe an improvement is anything you did NOT have to do. For instance, you don't have to remodel a bathroom or repaint, but you do have to replace a broken water valve (therefore an emergency plumbing repair is probably not an improvement unless you fix it better than new). Thoughts?

Hal_Al
Level 15

Can turbo tax be used if I sold and bought a home this year? Should I use an accountant this year??

Improvements are not just anything you did not have to do. In particular, painting is not an improvement, even a whole house painting. 

 

There are several good descriptions on the i-net, such as: 

https://www.houselogic.com/finances-taxes/taxes/tax-breaks-capital-improvements-your-home/#:~:text=A....

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