REAL ESTATE – Tax Deductions (Seller's Market)

It's been a while, but all for good reason. Among many other of life's demands, my pursuit to provide you with value continues. I decided to pursue a certification in Short Sales and Foreclosures (SFR). 

Some homeowners will experience challenges along the way. While those challenges may appear to be cripplingly unwelcomed, all is not lost. Realtor Largie can help mitigate those losses and help you through these tough times. Let's talk!

Home prices! Wow! Did you notice the price of real estate increasing? Of course you did! Did you sell? If so, you probably made a lot of money.

HINT: Call your CPA and discuss tax implications NOW! Don't wait until the year is over and say, "Oh, I forgot to tell you. I sold my house for $1.5M that we bought for $400K." He or she will probably say, "Congratulations! Let's talk about how much you may have to pay in taxes." Of course, Realtor Largie is a CPA, so you and I would have that conversation automatically.

With all the talks about the soaring home prices, inflation, recession, and the like, the real estate market could have significant tax implications for all stakeholders. It’s best to talk to your CPA and plan ahead, as the lack tax planning could cost you (seller) a lot of money.

Always remember to keep good records. As the ‘tables turn’ on the sellers’ market, here are some tax benefits that you should consider:
Deductible Expenses

• Staging, escrow, agent commissions, advertising, legal fees, seller-paid expenses, etc.
• Improvements, repairs, etc.
• Property taxes paid
• Interest paid
• Capital Gains exemption

Non-Deductible Expenses

• Insurance (other than mortgage insurance premiums)
• Wages you pay for domestic help
• Depreciation
• Utilities
• HOA Fees
• Repairs to Home

Naturally, this can be more complicated. For example, what if suddenly a professional athlete decides that you’re their CPA? It will be interesting to say the least to navigate their affairs optimally. 

On The Horizon: First Time Homebuyer Program

• First Time Homebuyer Tax Credit is currently no longer available, but Congress is making efforts to introduce a new tax credit of up to $15K!
• Fingers crossed!