My wife and I sold our primary reference in 2023. We are looking at capital gains of 350 to 400,000 in after considering appropriate deductions and the $500,000 exclusion. Are there any steps that we can take this year to minimize our capital gains taxes in 2023?
Hi @tbakerusa,
As you have identified, the amount of your gain is the purchase price after subtracting the original purchase price, appropriate deductions and accounting for the exclusion ($500,000 for a couple married filing jointly on their primary residence, lived in for at least 2 of the previous 5 years). The remaining gain will be taxed at the long-term capital gains rates.
One area that may be worth considering is tax-loss harvesting. If you have other investments that can be sold for a loss, they will offset the equivalent gain here, limiting your potential tax liability. This article explores tax-loss harvesting and when it may be beneficial: 5 Situations to Consider Tax-Loss Harvesting