Major life milestones often have a major tax impact. Changes in your marital status, having a baby or adopting a child can have significant impact on your taxes. This is the place to ask questions about dependents, real estate, and other various scenarios that play a significant role in what taxes you pay.
03-02-2018 03:08 PM
My parents purchased my home in 2011, I immediately moved in and claimed it as my permanent residence. I wrote monthly checks in an effort to payback my debt but the checks were never endorsed. In 2014, they gifted me the home. Throughout the years, I have spend thousands on upgrades and typical maintenance and now the homes value has increased $74k. I recently married and we are looking to sell my current home and upgrade to a larger more functional space. Will I have to pay capitol gains on the $74k difference upon the sale of my gifted home? And would the profit from the sale have to all be placed into a marital home or can I set some aside in an emergency fund without consequence?
03-07-2018 02:50 PM
Since you are married, you can exclude up to $500,000 in capital gains on your home. So the $74K is not taxable and you can do whatever you want with the money. There are no restrictions.