Did you know your home value grows tax free up to a certain amount?  Did you know income on the sale of an investment property or second home is taxed at a reduced rate from your ordinary income?  Whether you knew it or not real estate is a great wealth building opportunity. 

When you sell a home, if it is your primary residence, you can exclude $250,000 of the gain or $500,000 for those that file a joint tax return from your taxes.  That's a huge tax savings. and an incredible wealth building tool. See the IRS rules to see if you may qualify.

Recently we have seen home prices rise dramatically in the Summit County market.  It's been a similar story nearly everywhere nationwide.  If you are a home owner, you likely have had an increase in the value of your home.  If you're not selling, that gain doesn't mean much, but if you are, that increase in value could be 100% tax free.

If you own a second home or investment property that you are considering selling, your taxes on the gain could be minimal or deferred altogether.  If you're property is held more than one year, your gain can be considered a long term capital gain and taxed as a long term capital gain rate instead of included in your income and taxed at that, likely higher, rate.  If you are going to reinvest your gain into another property, you can defer your taxes altogether by doing a 1031 Exchange.  

We are not tax accountants, and as you know, every situation is different, but as real estate agents, we are aware of potential tax implications that can come with the sale of your property.  We can help you to identify those situations so you know what you should be talking to your CPA about.  Those conversations will help you determine your best strategy regarding the sale of your home.  Ultimately, that is our goal; to make your real estate experience the best it can be.