Looking for a little advice. I moved overseas and have been renting my house. However I think I might stay abroad so I’d like to sell it.
Unfortunately I didn’t live in it long enough before moving abroad to get the tax benefit when selling, however right now living abroad and working I have a 0% tax liability in the USA. If I sell now will that mean I am taxed 0% as capital gains? Tax stuff is not my strong point so any advice is appreciated.
Posted by jblu221
2 Comments
Presume you are a US citizen? So you have to file on your world wide income yes? You must be under the threshold right now to have zero liability (I think its called a foreign earned income exclusion or something like that) but you will have to declare the sale on the tax return for that year.
It will be reported to the IRS by the title company when you sell.
I think there’s a question about selling a property on the return.
Did you make a profit after you take into account commissions and other selling costs?
If you didn’t live in it 2 out of the last 5 years then you won’t get the primary home tax credit.
If you owned it for a year or more you will be taxed as long term capital gain (15 – 20% I think) on the profit only. If you owned it less than a year it will be a short term capital gain which is the same rate as earned income.
I’m not a CPA but you might need one this time around.
You phrase it like you’re not a citizen, but then say you don’t have any tax liability to the US. Citizen or not?