Are there any ways around the 6 month rule of reinvesting profits from a home sale?
I purcased a new RV 4 months before the house sale, can that count as a reinvestment?
My profit from my home sale will be around $127,000. I can not get a builder to build and close on a new home in 6 months. What are my options?
I also invested $30,000 of the profits to pay off all debt, any way for this to not be taxed?
The rule for purchasing another primary home after the sale of your home to defer capital gains taxes was removed from the tax code in 1997.
If you sold your primary personal residence and you lived in and owned the home for at least two years in the five year period on the date of sale, you do not have to report the sale if your gains are less then the exclusion amounts of $250,000 if filing Single or $500,000 if filing Married Filing Jointly (and both lived in the home for two years).
If you had a gain greater then the exclusion amounts then you would have to report the sale. Also, if you received a Form 1099-S for the sale either with a gain or a loss, the sale has to be reported.