Selling home in 1 year, how do you calculate tax penalty?

2 Responses

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1. Ottavio says

   Living in the state is a not bad idea

   October 10, 2008, 10:00 am
2. efflandt says

   It depends if you keep it more or less than a full year. If less than a year, you would be taxed as though that $30,000 gain (less selling expenses) was added on top of your other income.

   If you keep it more than a year, the gain would be taxed at the lower capital gains rate. Check WI Dept of Revenue website for specifics about state income tax for capital gains. I did look into that when considering selling WI property that I own, but am foggy on details (have not lived in WI since 1975).

   You would actually have to live in it for 2 years for up to $250,000 ($500,000 if married filing jointly) of gain to be excluded from federal income tax.

   October 10, 2008, 10:22 am