As the housing market improves, some taxpayers may incur a gain on the sale of their personal residence. Part if not all of that gain may not be subject to income or capital gain tax.
Capital gains are nice for two reasons. One, you probably made money. The second reason is that they might be taxed at a lower rate. Capital loss are the opposite. First, you lost money. Second, the losses might be limited.
In most cases, there may be no additional income tax when a taxpayer sells their personal residence. However, there are a number of issues that surround the typical sale of the home that may require you to contact your tax professional for clarification. Here are a few tips for consideration: