Capital Gains Tax is usually associated with stocks and if you make a profit or income on the stock then you have to pay a capital gains tax. What about when you sell your home? Who is responsible for the capital gains tax?
Well, that would be YOU the homeowner.
If you’re in a short sale situation AND experiencing a job or business LOSS—consider the tax consequences of the capital gains tax BEFORE you sign that listing agreement. Talk to your tax attorney or CPA first. If you don’t have a tax attorney or CPA, find one who can explain the tax consequences on the sale especially if you are facing a job or business loss. The foreclosure mess is just that– a mess and anything we can do as Realtors to help clients do what is in THEIR best interest is of utmost importance. Do what is best for yourself as the homeowner. It may not be in your best interest to sell that home at that particular moment. It may be best to hold on for another 6 months and speak to a tax attorney or CPA about the tax consequences of selling your home.
When a homeowners sells their home, they usually have a period of six months to put those proceeds into a new home or face “capital gains” taxes on the difference. Realtors may not be aware of this as we are not tax experts so make sure as a homeowner you get in touch with a tax attorney or CPA who can explain where you stand so you can move forward without any tax nightmares following you.