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Selling a rental property is more complicated than selling your personal home. If you're not using the proceeds to buy another property, it's going to cost you. The tax consequences of selling a ...
Gross income is sales price of goods or property, minus cost of the property sold, plus other income. It includes wages, interest, dividends, business income, rental income, and all other types of income. Adjusted gross income is gross income less deductions from a business or rental activity and 21 other specific items.
Here’s a list of common tax deductions if you have rental income: Mortgage interest. Property tax. Operating expenses. Depreciation. Repairs, including materials and supplies. Interest. Taxes ...
The tax is imposed on the sale or rental of goods, the sale of admissions, the lease, license, or rental of real property, the lease or rental of transient living accommodations, and the sale of a limited number of services such as commercial pest control, commercial cleaning, and certain protection services.
The remainder of any gain realized is considered long-term capital gain, provided the property was held over a year, and is taxed at a maximum rate of 15% for 2010-2012, and 20% for 2013 and thereafter. If Section 1245 or Section 1250 property is held one year or less, any gain on its sale or exchange is taxed as ordinary income.
As long as you rent for fewer than 15 days during the year, that rental income is tax free. Things to keep in mind when renting your home for two weeks or less:
Some U.S. states have a variety of transfer tax laws which may include specific exemptions for certain types of buyers based on buying status or income level. For example, Maryland exempts certain "first time buyers" from a percentage of the total [4] or excludes a portion of the property's sales price from taxation altogether.
It's important not to skip this step -- exemptions reduce your taxable income. For 2009, the personal income tax exemption amount is $3,650. That's per person, not per family.