What is Capital Gain?
December 9, 2019
Once we have a closing on a property, the brokerage company is happy because they got paid commission money, but the seller has a tax problem. Whenever a person in this country buys an asset, sells it later on and makes profit money, then the government wants to tax us on that profit, which is what we call a capital gain. A capital gain is where you make profit on things like the sale of real estate, so if the seller buys a house, sells it later on down the road and makes profit money, then that is a capital gain or profit that is taxable. However, for owner occupied homes that we live in, we have an exclusion. The 1997 Tax Act says that on houses we live in, not investment properties, when we sell those properties, if we are single, if their profit does not exceed $250,000 then no taxes will be owed. The full amount of profit would be excluded. If persons are married, then the exclusion amount of profit for capital gains is $500,000. Keep in mind that in order to claim this exclusion on owner occupied properties, the property must have been the principal's personal residence for two of the past five years.
What is a Life Estate?
December 22, 2023
Discover the benefits of life estates for property transfer, security, and inheritance planning. Learn how this unique legal arrangement can help you bypass probate, reduce taxes, and ensure a seamless transfer of property. Explore real-life examples and find out how it can fit into your estate plan
The Differences Between Real and Personal Property
December 22, 2023
Delve into the depths of real and personal property, and grasp their distinct characteristics and legal implications in property ownership. Explore the key differences between the two, including annexation and severance principles.
Debits and Credits in Real Estate
October 23, 2023
Navigate the world of debits and credits in real estate transactions with this comprehensive guide. Learn the significance of debits and credits, their roles in closing statements, and how to ensure smooth transactions. Mastering debits and credits is crucial for real estate professionals and aspiri