I recently sold my house and I’m unsure of my tax liability. I am 75 years old and have lived in the house for 49 years.
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Hello Bob and thanks for reaching out!
Your liability will be determined by the amount you sold the home for, minus any fees and expenses related to the sale, minus your basis in the home (what you originally paid for the home and any improvements).
When you make a home improvement, such as installing central air conditioning or replacing the roof, you can't deduct the cost in the year you spend the money. But, if you keep track of those expenses, they may help you reduce your taxes in the year you sell your house.
It depends on how long you owned and lived in the home before the sale and how much profit you made.
The law lets you "exclude" this profit from your taxable income. (If you sold for a loss, though, you can't take a deduction for that loss.)
There are three tests you must meet in order to treat the gain from the sale of your main home as tax-free:
If you're married and want to use the $500,000 exclusion:
I do my taxes myself, using turbo tax, will Turno walk me through the process when I file for this year?
Definitely! You can click or search for "sold a home" and it will walk you through the prompts, including handy tips on calculating your basis and sales expenses.
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