Real Estate Guys - Timing Question (1 Viewer)

[Statorama]

My wife and I own our home outright and were thinking about moving.  While our house is on the market, we'll be looking for a new home.  Our concern is that we might find a home that we like prior to selling our old house.  If we buy the new house before our old house sells, will we get hit with a capital gain tax when we eventually sell the old one?  Is there a "grace period" between the two?  Moving from Wisconsin to Illinois if that helps.

Just looking to avoid that danged Capital Gain Tax.

 

[avoiding injuries]

As long as you've lived in the home 2 of the past 5 years, you are exempt from capital gains. 

 

[Statorama]

As long as you've lived in the home 2 of the past 5 years, you are exempt from capital gains. 

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Thanks ai!

 

[eoMMan]

As long as you've lived in the home 2 of the past 5 years, you are exempt from capital gains. 

*Exempt only up to $500k in capital gains if married filing joint...

Several FBG's might have more than $500k in gains when they sell.

 

[Shutout]

Yup, both responses accurate.  Just went through this myself.  OP should be fine.  

Also, check with your realtor.  If you have a good one, he will know the temperature of the market.  Mine told me a house in the range I was selling was HOT.  House was on the market 4 hours. 

 

[MaxThreshold]

Wouldn't moving to IL basically eliminate any capital gains you would get anyways?  Besides, who in their right mind MOVES to Illinois?

 

[xulf]

Wouldn't moving to IL basically eliminate any capital gains you would get anyways?  Besides, who in their right mind MOVES to Illinois?

???

 

[Zegras11]

Wouldn't moving to IL basically eliminate any capital gains you would get anyways? 

Don't think this is a factor in any way.

 

[MaxThreshold]

Don't think this is a factor in any way.

Actually, I was trying to be funny - something about taxes being so ####### high and IL being so far in debt it's not even funny - paying it back has to come from somewhere.  

But I simply can't believe anyone voluntarily moves to Illinois anyways.  It's mind-boggling.

 

[jon_mx]

The only time that timing matters between buying and willing is if you do a like-kind exchange, but that applies commercial or certain other types of properties not your personal residence. 

 

[Statorama]

Actually, I was trying to be funny - something about taxes being so ####### high and IL being so far in debt it's not even funny - paying it back has to come from somewhere.  

But I simply can't believe anyone voluntarily moves to Illinois anyways.  It's mind-boggling.

Trust me, if it were just me I'd be in a trailer in Maui.  Being close to family is more important to my wife.  I am going to miss taxpayer friendly Wisconsin.