Selling my home

[Alexjmcrae]

I want to sell my home to make a profit but I want to rent my for a while before I buy a new home. My question is do I have to pay income tax on the profit I make from the sale  

if not how long do I have before I purchase a new home. 

[xmasbaby0]

Did you mean that after you sell your home you want to live in a rented home for awhile before you purchase a new home?  And you want to know how long you can wait to buy another home?  The last year that it mattered whether you purchased another home to avoid capital gains was 1997.  So you can rent for as long as you want and buy another home whenever it suits you.

SALE OF HOUSE

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 owned 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

[Opus 17]

If you are single, and you lived in the home as your main home for at least two years, you can exclude the first $250,000 of capital gains from your income. If the gain is larger than $250,000, you will have to pay capital gains tax on that portion.  You can rent the home for up to three years after you move out and still qualify for this exclusion. But when you sell the home, if the closing date is even three years and one day after you moved out, you will not qualify for the exclusion and you will have to pay capital gains tax on the entire gain.  Also, when you rent the home you will be entitled to take a tax deduction for depreciation. That tax deduction must be repaid when you sell the home. It is called recapture of depreciation, and you have to pay tax on the part of your capital gain that is depreciation recapture even if the rest of your gain qualifies for the exclusion.

[xmasbaby0]

@Opus 17 @Alexjmcrae  

This post seemed to be missing a word or two in an important part of the question that leaves it open to interpretation.  I interpreted it to mean the user wants to BE a renter for awhile after he sells his house before he buys another home.    But if he means he wants to use House #1 as a rental property for awhile, that changes the answer he needs.  

@Alexjmcrae  Could you look again at this question and fill in the missing word(s)?

I want to sell my home to make a profit but I want to rent my for a while before I buy a new home.

"I want to rent my ___________________________ for a while...."