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Mortgage Assumption

Selling personal real property acreage (Nebraska) including a house. Buyer is assuming the mortgage using his personally arranged financing (not our mortgage holder). What are the Capitol Gains implications for this mortgage assumption.? How do I report/identify the sale on my 2024 tax return?

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EleanoreS
Employee Tax Expert

Mortgage Assumption

With an assumable mortgage, you as the seller must be compensated for the equity you have built up in the home.  The buyer generally pays the difference between the selling price and the remaining mortgage balance,

 

The property having an assumable mortgage that was transferred does not change the capital gains tax calculation.

 

You noted you were selling personal real property including a house.  You did not specify if this was your primary residence.  

 

If the real property is your primary residence, you may be able to exclude all or a portion of the gain on the sale.  Here is a link to a TurboTax Help Article How does selling a home affect my taxes?

 

If the real property is an investment property, that is handled very differently. This TurboTax help article tells you Where to enter the sale of a second home, an inherited home, or land .

 

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