By Laura Saunders | The Wall Street Journal
After years in the doldrums, housing markets are heating up in many parts of the country. That makes it a good time review the taxes—and the tax breaks—on home sales.
“Home sellers get some of the best breaks in the tax code, and often no federal tax is due,” says Julian Block, an attorney in Larchmont, N.Y., who has written many tax guides, including one for people selling their homes.
Yet Uncle Sam’s largess in this area is quirky. For example, the sale of a boat that you live in could be tax-free, but profits on the sale of a second or third home are taxable. People often misunderstand the rules, says Melissa Labant, a tax specialist at the American Institute of CPAs. Here is what sellers and sellers-to-be need to know.
If you’d like to discuss real estate matters, contact Rose Law Group founder Jordan Rose, jrose@roselawgroup.com
