Barefoot Kicker Posted April 12, 2012 Share Posted April 12, 2012 Ok. So here's the situation. I am trying to put my family in the best financial situation as possible (as we all are) In 2003 I bought a townhouse in Virginia for $218,000 (my father is a co-signer on the loan). I lived in it as my primary residence until September 1st 2009 when I got married and moved into a townhouse she had purchased a few months before the wedding (I co-signed on this loan). So the 1st property it was my primary residence for 6.5 years. The 2nd property was our primary residence since September of 2009. We converted the 1st property into a rental property the month that I moved out. Now our family is growing and neither of the townhomes will work well for us if we have have a 2nd baby. So we want to look into buying a single family home. We are thinking of selling the current rental property and converting our current primary propery into the new rental property and then we will buy a single family as our new primary residence. So, to avoid paying capital gains on the rental property we are going to try and sell... is it 2 of the LAST 5 years that the property must have been my primary? or is it 2 years in general (6 of the last 9 years the property will have been my primary)? if it is 2 of the LAST 5 years, then since it will have been a rental property for 3 years on Sept. 1, 2012 then MUST I sell it by that date? What are ways in this sitation to avoid a capital gains hit? I can definitely use any advice (we are also going to be speaking with a mortgage specialist soon). If you need any more info on the situation, please ask. **Additional info. -Both properties are FHA loans. -the rental property could possibly sell for $300,000 and we owe approx. $185,000 (and we also have a $50k equity loan, so we owe a total of about $235k on it) THANKS! Link to comment Share on other sites More sharing options...
daveakl Posted April 13, 2012 Share Posted April 13, 2012 I believe it is 2 of the last 5. I also would check with a tax adviser to be safe. You could take the proceeds and roll them into a new investment property (like kind exchange). Link to comment Share on other sites More sharing options...
LadySkinsFan Posted April 13, 2012 Share Posted April 13, 2012 Yep, consult a tax guy. I have a 2nd property, not a rental but it's not been my primary residence for a number of years. When I sell it, I'll have to take the capital gains hit, which I need to do soon so the CG is only 15% before Obama raises it. Link to comment Share on other sites More sharing options...
Rocky21 Posted April 13, 2012 Share Posted April 13, 2012 Get a ****ing accountant. We bozos in the Tailgate are sure to give you bad advice. Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.