Quote:
Originally Posted by Vjo
In the US you can sell a house once per lifetime (primary residence) and not pay income tax (capital gain) on the house. Up to a certain amount, perhaps $300,000.
But only one time.
Thus if your parents, for example, end up in the end with no money and only the house, you sell the house, which all quickly goes to the assisted living/nursing home and/or medical assistance, then they suddenly die broke before tax time, the administrator and estate wont have a huge tax obligation on the house. This happens all the time.
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Pretty sure they did away with the "once per lifetime" and you can do it as many times as you qualify. It's 250K single, 500K married per instance, you have to live their for 2 years as your primary residence (i believe 2 out of the last 5 years). You can't do this more than once every two years. This is on capital gains meaning, profit. (how much you bought it for - how much you sold it for including other costs like improvements, real-estate agent commissions, closing costs etc. Situations like this are more likely for people who bought a house several years ago and paid it off and it has increased in value a lot over 15,20 years and then they sell it.
What in the world does this have to do with this thread though?
Also I believe there is a 2-3 look back when people go into govt nursing homes etc, so if you going to sell the house or whatever before you go, you better plan ahead 3+ years. Also, there is such a thing as a gift tax as well, so if your parents "give you the house" the children can still get hit with taxes. <- all of that is for an estate planner, something I am not well versed in.