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Old 11-08-2015, 07:44 PM
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capitol gains selling home

bought my home in 1953, i am 87 years old, bought it for 14,700, selling it for 380,000, no improvments to home to deduct, wife died 12 years ago, so single deduction. there is a 323,000 reverse mortgage on it, how much will i owe in capitol gains taxes, i am retired on social security and va care benefits, i make 43,272 a year. any help apprecated



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Old 11-08-2015, 08:44 PM
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bought my home in 1953, i am 87 years old, bought it for 14,700, selling it for 380,000, no improvments to home to deduct, wife died 12 years ago, so single deduction. there is a 323,000 reverse mortgage on it, how much will i owe in capitol gains taxes,===>As you can see, aslongas you meet the 2/5 rule, then, you can avoid long term capital-gains tax when you sell a house and move. Under the current rules, every time you sell your house, you could owe taxes. Single filers can exclude $250K of gains on every sale. You can take that deal every 2years.
So, you, as single person , can exclude only $250K of long term capitalgain. In yourt case your adjusted basis is still $14.7K and your LTCG is $365.3K;$380K-$14.7K; then you need to pay LTCG tax on $115.3K;$365.3K-$250K; your tax rate ‘d be 15% aslongas your tax bracket, I mean your tax rate is 25% or higher.

And depending on where you live, you might also owe state and local taxes.



i am retired on social security and va care benefits, i make 43,272 a year.=====>>as single aslongas your MAGI, the provisional income, AGI +50% of your Soc Sec benefits, 25K or exceeds $25K, then you need to include 50% or 85% of your SS benefits on your return.25K or you, as a
borrower, do not need to pay income tax on your reverse mortgage proceeds so you do not include RM proceeds on your 1040. , they usually don’t affect your Social Security or Medicare benefits.however, if you paid interest on a Reverse Mortgage , then, In many cases the interest and some of the fees paid on your reverse mortgages are tax deductiblebut not until they are paid, which is generally when the loan is paid in full;also, this deduction is likely limited because it is subject to the limit on home equity debt.



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