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Any real estate agents or tax people here? I have a question for a friend. She is thinking about selling her house to move closer to her kids. She has had it for about 30 years and it has substantially increased in value.
She thinks the house will sell for about $750,000 and she purchased the house for about $100,000 meaning she will have a profit of about $650,000. Under the current law she knows that she can take $250,000 out of it tax free since she is single which means that $400,000 would be taxable.
Her question is can she buy another house for $400,000 and protect the gain from taxes, or is that no longer allowed?
She thinks the house will sell for about $750,000 and she purchased the house for about $100,000 meaning she will have a profit of about $650,000. Under the current law she knows that she can take $250,000 out of it tax free since she is single which means that $400,000 would be taxable.
Her question is can she buy another house for $400,000 and protect the gain from taxes, or is that no longer allowed?