I'm aware that you can avoid paying tax on up to 250k of capital gains from the sale of a primary residence. However, are there other areas this gain may affect or is it not even required to be included in your tax forms if under 250k?
Specifically, if I had a 200k gain, is any of that included for determining if I exceed certain AGI thresholds (education credits, roth contribution eligibility, etc) or for ACA subsidies?
Thanks
What taxes do capital gains from primary residence affect?
Re: What taxes do capital gains from primary residence affect?
I’m not aware of any effects from excluded gains on a primary residence. It’s not included in Adjusted Gross Income, and not in any of the various Modified Adjusted Gross Income calculations. Specifically, it doesn’t look to be included in income for ACA subsides:
https://www.healthcare.gov/income-and-h ... come/#magi
https://www.healthcare.gov/income-and-h ... come/#magi
Re: What taxes do capital gains from primary residence affect?
Not for federal taxes, but there are some state credits that could be affected - such credits may or may not be relevant to your particular situation.
Re: What taxes do capital gains from primary residence affect?
Thank you both. Very helpful.
Re: What taxes do capital gains from primary residence affect?
Follow up on this (for anyone who knows):Stuckinmn wrote: ↑Tue Jun 06, 2023 9:21 pm I'm aware that you can avoid paying tax on up to 250k of capital gains from the sale of a primary residence. However, are there other areas this gain may affect or is it not even required to be included in your tax forms if under 250k?
Specifically, if I had a 200k gain, is any of that included for determining if I exceed certain AGI thresholds (education credits, roth contribution eligibility, etc) or for ACA subsidies?
Thanks
If I have carryover tax losses from tax loss harvesting (say $20k in carryover losses, which would absent any capital gains be used $3k at a time to offset income), and then sell my house and have capital gains on the sale that by themselves are below the taxable threshold (i.e. a $100k gain), do I nonetheless need to apply my carried over tax losses to that capital gain (i.e. apply that $20k in tax losses to my $100k capital gain for the primary residence sale, using it up, and thus not having it anymore to offset income)?
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Re: What taxes do capital gains from primary residence affect?
No. Your capital gains from your house (here, $100,000) would not be reportable so your carryover loss would remain as it is.Chadnudj wrote: ↑Wed Jun 07, 2023 7:39 amFollow up on this (for anyone who knows):Stuckinmn wrote: ↑Tue Jun 06, 2023 9:21 pm I'm aware that you can avoid paying tax on up to 250k of capital gains from the sale of a primary residence. However, are there other areas this gain may affect or is it not even required to be included in your tax forms if under 250k?
Specifically, if I had a 200k gain, is any of that included for determining if I exceed certain AGI thresholds (education credits, roth contribution eligibility, etc) or for ACA subsidies?
Thanks
If I have carryover tax losses from tax loss harvesting (say $20k in carryover losses, which would absent any capital gains be used $3k at a time to offset income), and then sell my house and have capital gains on the sale that by themselves are below the taxable threshold (i.e. a $100k gain), do I nonetheless need to apply my carried over tax losses to that capital gain (i.e. apply that $20k in tax losses to my $100k capital gain for the primary residence sale, using it up, and thus not having it anymore to offset income)?
Re: What taxes do capital gains from primary residence affect?
If you are able to exclude the entire gain on the home sale then there is no gain to apply the carryover loss to.Chadnudj wrote: ↑Wed Jun 07, 2023 7:39 am If I have carryover tax losses from tax loss harvesting (say $20k in carryover losses, which would absent any capital gains be used $3k at a time to offset income), and then sell my house and have capital gains on the sale that by themselves are below the taxable threshold (i.e. a $100k gain), do I nonetheless need to apply my carried over tax losses to that capital gain (i.e. apply that $20k in tax losses to my $100k capital gain for the primary residence sale, using it up, and thus not having it anymore to offset income)?
But note that taking the exclusion isn't required. You might decide to apply the carryover loss to the gain on this home sale instead, especially if you want to use the exclusion against another home sale in the next two years, or if you have a very large carryover loss and relatively small gain.
Re: What taxes do capital gains from primary residence affect?
Thanks to you and MP123 for the answers!Artsdoctor wrote: ↑Wed Jun 07, 2023 8:27 amNo. Your capital gains from your house (here, $100,000) would not be reportable so your carryover loss would remain as it is.Chadnudj wrote: ↑Wed Jun 07, 2023 7:39 amFollow up on this (for anyone who knows):Stuckinmn wrote: ↑Tue Jun 06, 2023 9:21 pm I'm aware that you can avoid paying tax on up to 250k of capital gains from the sale of a primary residence. However, are there other areas this gain may affect or is it not even required to be included in your tax forms if under 250k?
Specifically, if I had a 200k gain, is any of that included for determining if I exceed certain AGI thresholds (education credits, roth contribution eligibility, etc) or for ACA subsidies?
Thanks
If I have carryover tax losses from tax loss harvesting (say $20k in carryover losses, which would absent any capital gains be used $3k at a time to offset income), and then sell my house and have capital gains on the sale that by themselves are below the taxable threshold (i.e. a $100k gain), do I nonetheless need to apply my carried over tax losses to that capital gain (i.e. apply that $20k in tax losses to my $100k capital gain for the primary residence sale, using it up, and thus not having it anymore to offset income)?