Comments on: New Rules on $250,000-$500,000 Capital Gain Exclusion on Sale of Principal Residence

By: Tom Carlson

Tom Carlson — Wed, 06 May 2009 22:34:58 +0000

Len,

That is an interesting question and quite complicated. I would recommend consulting a CPA and a tax attorney. Their fees will be well worthwhile.

By: Len

Len — Mon, 23 Mar 2009 23:26:08 +0000

“Q: I want to buy my brother’s home (essentially for the amount of the mortgage), which I would allow my brother to continue to live in, and which I would use as a second (vacation) home. When my brother leaves the house (death, nursing home, etc.), I plan to sell the house and use the IRS $250,000 capital gain exclusion (assuming at least two years of ownership). Are there any potential problems with this plan? Would it be wise to place the house in a trust?”

I disagree with the author’s comment “I see no real problems with your proposed plan…”

The questioner is not able to use the capital gain exclusion for a house which is not his principal residence, whether it is a second home or one his brother occupies. He did not say he would move into the house as his principal residence for 2 years after his brother dies. Only if he did would he qualify for any exclusion at all.

The author is correct however that the new rules effective 1/1/2009 provide that any gain gets reduced/prorated by the number of months of ownership after 1/1/2009 which are not principal residence. That is a new change.

By: Scott Cash

Scott Cash — Wed, 03 Dec 2008 00:31:48 +0000

Notice they never want to discuss commercial property?
I have been reducing assessments on commercial property in California since 1991. I have been successful on Retail centers, Office buildings, Industrial buildings, Mini Storages, bare land, apartments and special use properties.
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By: Property

Property — Tue, 02 Dec 2008 07:05:15 +0000

Under current law, a surviving spouse has only until the end of the tax year in which the death occurred to use the exclusion. Property