Thanks to all of you for the referrals last week, I am glad I could turn so many last minute crises into home closings. We recently hired more help so we are ready and able to handle all of your challenging cases (we have great rates and incredibly quick turn times for well qualified home buyers too!).
On to part 3: A somewhat well known tax loophole is about to be closed, and if you or your clients own a vacation home or an investment property it may be motivation to sell.
As some of you may know there is a capital gains cost on any profit from the sale of a non-primary residence property. This tax on the profits could be avoided in the past, however, if the owner moved into the property and called it his/her residence for 1 day. Rarely, did a property get sold and not have the owner “move-in” for a day. Effective with the passing of this bill, the reduction to taxes on profits will now be based on how long the owner lived in the property. One day will provide virtually no tax relief and it will be hard to “fudge” the numbers if you want to get rid of a substantial portion of the taxes. The profit will now be taxed as ordinary income. If you have a big profit available in a non qualifying personal residence, now may be a good time to sell even with the market being a little slow.
--Keith
**If you know someone else who would benefit from these updates, please pass this link on to them http://www.realestatemortgagenews.com
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