TIPS TO KEEP IN MIND IF YOU'RE SELLING YOUR HOUSE THIS SUMMER

The IRS recently posted the following reminder -Homeowners may qualify to exclude from their income all or part of any gain from the sale of their main home.

Ownership and Use. To claim the exclusion, the homeowner must meet the ownership and use tests. This means that during the five-year period ending on the date of the sale, the homeowner must have:

• Owned the home for at least two years  
• Lived in the home as their main home for at least two years
  
• If there is a profit from the sale of their main home, the homeowner may be able to exclude up to $250,000 of the profit from income or $500,000 on a joint return in most cases. 
• If there is a loss from the sale, that loss is not deductible.
• If the property has been a rental for any portion of the five-year prior prior to the sale, the amount of profit that may be excluded may be limited.

Possible Exceptions.  There are exceptions to the rules above for persons with a disability, certain members of the military, intelligence community and Peace Corps workers, among others. For more information information about those situations, contact your tax preparer.
Items to Keep In Mind:

• Taxpayers who own more than one home can only exclude the gain on the sale of their main home. Taxes must paid on the gain from selling any other home, such as a vacation home.
• Taxpayers who used the first-time home buyer credit to purchase their home have special rules that apply to the sale. 
• Taxpayers moving after the sale of their home should update their address with the U.S. Postal Service and all creditors.
• Taxpayers who purchased health coverage through a Health Insurance Marketplace should notify the Marketplace when moving out of the area covered by the current Marketplace plan.

Turner's Tax Service is prepared to assist you with the proper and accurate reporting of the the sale of your house.  Please give us a call at 530-626-8551