Tax Guru-Ker$tetter Letter
Friday, March 23, 2001
Almost every single day, I encounter someone asking about the tax ramifications of selling their home. They are almost always under the impression that either they have to reinvest into a more expensive home or wait until after they are 55 in order to receive a tax free exclusion of profit.
The current rules for residence sales, which allow up to $250,000 or profit per person tax free, are summarized here.
This is such a perfect illustration of the problem with our tax system. It's ever-changing and so few people understand it.
What is so amazing to me is that this isn't a recent change. It happened almost four years ago, in May 1997. It is taking an awfully long time to filter out around the country. What is even scarier is that there are still many tax & real estate professionals who are completely unaware of these changes. There is even one alleged Tax Expert on AskMe.com who is totally oblivious to this tax law change, as well as most other aspects of tax law.