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Find Celebration, Lake Nona, Orlando and Windermere Homes:

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Real Estate Tips
Tax Considerations >Your Tax Free Profits

Significant tax reform legislation was signed into law with the Taxpayer Relief Act of 1997. This legislation replaced both the one-time $125,000 tax-free exclusion for homeowners aged 55 and older, and the "rollover" deferment of capital gains tax requiring the purchase of a replacement home of higher or equal cost within two years of the sale of your principal residence.

With this change, a married couple filing their taxes jointly pays capital gains taxes only on that portion of home sales profits that exceeds $500,000. Single taxpayers, heads of households, and married persons filing separately may exclude up to $250,000. The exclusion is available for all sales of homes that occurred on or after May 6, 1997. Homeowners can use this tax-free provision every two years.

You are allowed to keep these tax-free profits only if you have owned and used the home as your principal residence for two out of the five years prior to the sale of the property. Although the regulations do not require continuous occupancy, the IRS specifies that your principal residence must be the home you use for the majority of time during the year. Consult your tax advisor about your personal circumstance.

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Real Estate Trivia
Q 
What famous American monument is also the world's heaviest statue?

A 
The Statue of Liberty, officially named "Liberty Enlightening the World", weighs 54.31 million pounds.
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Karen Donohoe, REALTOR®, real estate agent and broker for Celebration, Lake Nona, Orlando and Windermere, Florida home listings, property and land for sale - NUMBER1EXPERT

Karen Donohoe
Century 21 Real Estate Professionals

720 Celebration Ave. Suite 100
Celebration FL 34747
Karen Donohoe: 407-748-4861
Fax: 407 566-8511
karen.donohoe@gmail.com

Karen Donohoe, Realtor

Equal Housing ERC MLS REALTOR wcr


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