Tax Year 2017
Filing Status Single [but looking]
Residential Property Sold for over $250K [Held for 10 years should be long term capital gain]
Working & Living Overseas in 2017 so assuming I have zero or less than $39K in reportable income will I have to pay captial gains on the amount over $250K?
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All of your income is reportable, and goes on your tax return. Even your Foreign Earned Income.
If you meet certain rules, you may not directly owe tax on your Foreign Earned Income. However, that Foreign Earned Income DOES still affect the taxation of your other income, including your capital gains.
In other words, if your total income (INCLUDING your Foreign Earned Income) are in the 25% tax bracket or higher, those capital gains will be taxable (usually 15% for Federal, plus State). It is also possible it could be subject to the 3.8% Net Investment Income Tax.
All of your income is reportable, and goes on your tax return. Even your Foreign Earned Income.
If you meet certain rules, you may not directly owe tax on your Foreign Earned Income. However, that Foreign Earned Income DOES still affect the taxation of your other income, including your capital gains.
In other words, if your total income (INCLUDING your Foreign Earned Income) are in the 25% tax bracket or higher, those capital gains will be taxable (usually 15% for Federal, plus State). It is also possible it could be subject to the 3.8% Net Investment Income Tax.
Yes, any sales gain over the $250k (assuming you qualify for the exclusion) will be taxed. For more information on Sale of Home, please click on the following link: https://turbotax.intuit.com/tax-tools/tax-tips/Home-Ownership/Tax-Aspects-of-Home-Ownership--Selling...
Depending on how much income you will make overseas will affect your long-term capital gains on the sale of your home.
Fortunately, capital gains receive special treatment vs ordinary income:
Therefore, your overall income will dictate your capital gains tax rate...
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