Open TurboTax

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
Announcements
Your taxes, your way. Get expert help or do it yourself. >> Get started
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

cancel
Showing results for 
Search instead for 
Did you mean: 
dugas1025
New Member

I bought a smaller house 2016---after selling my house in same year (2016) ---is there nothing to deduct or get credit for---I dont see any categories pertaining to this

 
1 Best answer

Accepted Solutions
Texas Roger
Level 15

I bought a smaller house 2016---after selling my house in same year (2016) ---is there nothing to deduct or get credit for---I dont see any categories pertaining to this

Regarding the sale of your house, you may be able to exclude from income any gain up to a limit of $250,000 ($500,000 on a joint return in most cases).

To claim the exclusion, you must meet the ownership and use tests. This means that during the 5-year period ending on the date of the sale, you must have:

Owned the home for at least 2 years (the ownership test), and

Lived in the home as your main home for at least 2 years (the use test).

If you qualify for the capital gain exclusion, you do not have to report the gain on the sale of your personal residence on your federal tax return unless the gain on the sale was greater then the exclusion, you rented out the home at some point, you claimed a home office deduction, or you received a Form 1099-S for the sale of the home.

Regarding the closing costs with the sale of the old house and purchase of the new house, most expenses at closing on the purchase or refinance of a home are added to the cost of a home and are not deductible but are added to the cost basis of the home.  There are a few exceptions - the following would be deductible:

1. Interest paid at the time of purchase (the charge at closing would normally be done for interest up to the date of first payment.) This is sometimes included in the 1098 from the new lender.

2. Real estate taxes charged to you and not reimbursed by seller

3. Points or origination fees.  On a refinance they need to be amortized over the life of the loan unless the points were used to improve your main home.

4. Private mortgage insurance costs but, if prepaid, only the amount allocable to this year based on an 84 month amortization.

Title fees, real estate commissions, documentary stamps, credit report costs, costs of an abstract, transfer taxes, attorney fees, etc. are not deductible, but are added to the cost of the property.



View solution in original post

4 Replies
Texas Roger
Level 15

I bought a smaller house 2016---after selling my house in same year (2016) ---is there nothing to deduct or get credit for---I dont see any categories pertaining to this

What is "a maller n"?
dugas1025
New Member

I bought a smaller house 2016---after selling my house in same year (2016) ---is there nothing to deduct or get credit for---I dont see any categories pertaining to this

reposted with corrections
Texas Roger
Level 15

I bought a smaller house 2016---after selling my house in same year (2016) ---is there nothing to deduct or get credit for---I dont see any categories pertaining to this

Regarding the sale of your house, you may be able to exclude from income any gain up to a limit of $250,000 ($500,000 on a joint return in most cases).

To claim the exclusion, you must meet the ownership and use tests. This means that during the 5-year period ending on the date of the sale, you must have:

Owned the home for at least 2 years (the ownership test), and

Lived in the home as your main home for at least 2 years (the use test).

If you qualify for the capital gain exclusion, you do not have to report the gain on the sale of your personal residence on your federal tax return unless the gain on the sale was greater then the exclusion, you rented out the home at some point, you claimed a home office deduction, or you received a Form 1099-S for the sale of the home.

Regarding the closing costs with the sale of the old house and purchase of the new house, most expenses at closing on the purchase or refinance of a home are added to the cost of a home and are not deductible but are added to the cost basis of the home.  There are a few exceptions - the following would be deductible:

1. Interest paid at the time of purchase (the charge at closing would normally be done for interest up to the date of first payment.) This is sometimes included in the 1098 from the new lender.

2. Real estate taxes charged to you and not reimbursed by seller

3. Points or origination fees.  On a refinance they need to be amortized over the life of the loan unless the points were used to improve your main home.

4. Private mortgage insurance costs but, if prepaid, only the amount allocable to this year based on an 84 month amortization.

Title fees, real estate commissions, documentary stamps, credit report costs, costs of an abstract, transfer taxes, attorney fees, etc. are not deductible, but are added to the cost of the property.



dugas1025
New Member

I bought a smaller house 2016---after selling my house in same year (2016) ---is there nothing to deduct or get credit for---I dont see any categories pertaining to this

Thank you

About Community

Learn about taxes, budgeting, saving, borrowing, reducing debt, investing, and planning for retirement.

3.48m
Members

2.6m
Discussions

Manage cookies
v