I am selling my condo to a friend for cash (without listing the property and going the normal route with a realtor) and will be depositing $200 to $300K into my checking account this year. How will this be taxed? Is is the normal capital gains tax? I will be buying another house in AZ next year and putting that money to the purchase.
Hi @rburbrink Thank you for joining us today and congrats on the sale of your home!
California conforms to the IRS rules and allow you to exclude up to $250,000 gain on the sale of your home for single filers. You only need to complete the home sale purchase in the federal section of TurboTax and and the information will carry to your California state return. You can generally qualify for this exclusion if you owned and lived in the home for a total of 2 of the 5 years before the sale.
As I understand you did not use a realtor, but you should still have received closing documents from the title company when you purchased and then again when you sold your condo.
To properly report the sale of your primary residence gather the following documents:
Using your documentation you can then determine the adjusted basis of the home starting with the home purchase price, plus the costs to purchase the home and any major home improvements. You will also need to reduce this amount by any losses or tax credits.
The sales price of the home is reduced by the selling costs, title fees, etc. to sell the home typically listed on closing agreement. Many of these expenses can be substantial.
The adjusted sales price less the adjusted basis of the home will give you your overall gain.
TurboTax is great at guiding you through these questions and helping you to capture all of the related costs and expenses. Here is a link for additional information on items to consider
Thank you!
Melanie, CPA
Hi @rburbrink Thank you for joining us today and congrats on the sale of your home!
California conforms to the IRS rules and allow you to exclude up to $250,000 gain on the sale of your home for single filers. You only need to complete the home sale purchase in the federal section of TurboTax and and the information will carry to your California state return. You can generally qualify for this exclusion if you owned and lived in the home for a total of 2 of the 5 years before the sale.
As I understand you did not use a realtor, but you should still have received closing documents from the title company when you purchased and then again when you sold your condo.
To properly report the sale of your primary residence gather the following documents:
Using your documentation you can then determine the adjusted basis of the home starting with the home purchase price, plus the costs to purchase the home and any major home improvements. You will also need to reduce this amount by any losses or tax credits.
The sales price of the home is reduced by the selling costs, title fees, etc. to sell the home typically listed on closing agreement. Many of these expenses can be substantial.
The adjusted sales price less the adjusted basis of the home will give you your overall gain.
TurboTax is great at guiding you through these questions and helping you to capture all of the related costs and expenses. Here is a link for additional information on items to consider
Thank you!
Melanie, CPA