What percentage of federal taxes do you pay when you sell your home?

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1085453

2026-05-07 17:31

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You pay taxes only on the profits (if any).

If you owned the house for any two of the previous five years and the house was your principle residence for any two of the previous five years, the first $250,000 is tax free. If you file jointly and your spouse also lived in the house for two of the previous five years, the first $500,000 is tax free. A reduced exclusion is available if you didn't meet the requirements but had to move for reasons beyond your control.

The remainder is taxed as a capital gain. The long term capital gain rate is 0% or 15%. The short term rate is the same as for ordinary income. You may not claim a capital loss for a personal use property.

State taxes are additional. Remember that you have to pay taxes to the state where the house is located even if you moved out of state.

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