Agent

Title issue kills $500K tax break

Learn the New Luxury Playbook at Luxury Connect | October 18-19 at the Beverly Hills Hotel

DEAR BOB: I sold my principal residence in January 2006 with a capital gain of about $400,000. The same day, I bought another house using the profit as a down payment. I was single until April 2006. Mine was the only name on the title to the house that was sold. But my partner (now wife) and I had been splitting the mortgage payments for more than 24 months. It was our primary residence for more than two years before the sale. Can we file jointly and receive $500,000 capital gains tax deduction? --Tim C. DEAR TIM: You can file a joint tax return because you are now married. But that won't help you increase your Internal Revenue Code 121 principal-residence-sale tax exemption above $250,000. The fact you bought another house is irrelevant. Purchase Bob Bruss reports online. Of course, you are entitled to a $250,000 home-sale tax exemption under IRC 121 because you owned and occupied your principal residence more than 24 months during the last 60 months before its sale. However, you...