We buy houses in Miami Florida. It’s almost that time of year… yes, tax season is almost upon us! If you are selling a house in Miami FL, you will love these tax tips for selling your home! We are professional homebuyers in Florida and this article is for informational purposes only!
For specific questions, contact a trusted tax professional, or the IRS!
Not All Profits Are Taxable In Miami FL
You will be able to exclude a high portion of your profits so long as certain conditions are met. Typically, you will be able to exclude $250,000 from your tax return, and up to $500,000 if filing a joint return. (However, if you sell for a loss, you won’t be able to take a deduction for that amount.)
The deduction is only available when selling your primary residence, and can only be used once every two years. To qualify for the deduction, you must have lived in the residence for at least two of the past five years.
It is important that whenever you move, your address is updated with the IRS.
Other Exclusions In Miami FL
If you do not meet the requirements above, you might still be able to exclude a portion of your profits from your income tax. There are many special conditions you can meet in order to receive a prorated, tax-free gain. If you need to sell because of a change in your health, a job change, or other unforeseen circumstances, you will be able to write-off a portion of the profit.
Reporting The Sale Of Your FL House
You will need to report the sale if you receive a 1099-S form from the closing agent. This form provides the IRS with information regarding the proceeds from real estate transactions. To avoid reporting, make sure that you are able to exclude all profits. Let the agent know at the time of closing that the form will not need to be issued. Even if you are able to deduct all profits, if the form is issued, you will still need to file it with the IRS… even if no money is owed.
Capital Gains Taxes In Florida
If you are selling an investment property or house you have only owned briefly, you will likely be subject to the capital gains tax. Capital Gains taxes are dependent on how much you make. If you have a lower income, you will pay no capital gains taxes. People in higher tax brackets can pay upwards of 20%. Short-term assets are typically taxed the same as ordinary income.
First-Time Homebuyer Credit In Miami FL
Depending on the dates you bought and sold, you might have to pay back all or part of the credit you received. Typically if you move within 36 months of purchasing the home, the credit must be paid back upon the sale of the home. Special rules apply and can be found in Publication 523 from the IRS.
Deduct Selling Costs In Florida
When selling your Miami FL house, you will be able to deduct any reasonable cost when selling your home. This includes the closing costs, improvements made in order to sell the house, assessments, marketing costs, agent fees, and so on. Keep track of every cent you spend in an effort to sell your home. Come tax time, this can amount to major deductions!
No matter what time of the year you sell, it is always important to seek the counsel of professionals. Consult your agent, accountant, and attorney to make sure you have set up the best terms for yourself.
Sell My House In Miami FL
Don’t stress too much about taxes when putting your house up for sale in Miami FL. Odds are Uncle Sam won’t be getting his hands on your profits.
If you need to sell your house in Florida fast and just want a quick and effective sale so you can walk away, you can sell it to Florida Cash Home Buyers. We’re professional Miami FL home buyers and we offer cash for houses in Florida. Just reach out to us or fill out the form on this website so we can quickly look at your situation and make you a fast-fair cash offer on your Miami FL property.