All Forum Posts by: Rosalie Taran

@George Blower Thank you for your assistance!

@Carl Fischer thank you for your response. We have been in our home for 17 years so we luckily don't have to worry about that aspect.  

@Dmitriy Fomichenko and @Katie L. thank for your response! Greatly appreciated :)

@Lance Lvovsky Thank you Lance! I appreciate your response. This is all a bit overwhelming!! LOL

Hi BP community,

My husband and I will be selling our California home early next year and are expecting to have capital gains above and beyond the 121 Exclusion of $500K.

1. I have a home business and just opened a Solo 401k. My plan is to apply for an extension on our 2017 income taxes until we have received the proceeds from our home sale. Then contributing the max allowed contribution to the 401k for both my husband and I (using proceeds from sale) to off set our taxes owed for 2017. My assumption is that we would meet with a CPA and do a preliminary tax prep to discover the right amount to contribute to the 401K (instead of loosing the money to taxes)? 

2.Then when 2018 tax time rolls around and it is time to pay taxes on the capital gains above and beyond the 121 Exclusion we will again contribute to our 401k to off set our income to reduce the tax bracket we are in to possibly avoid capital gains all together or at least to the reduce the amount we will owe. From what I have read so far it sounds like the tax reform will allow those who are married with income below $77,200 to not have to pay capital gains. Are my interpretations correct?

3. Also, we will be moving to Idaho. When we do our 2017 taxes will we need to find a CPA in California for our 2017 taxes since the income was solely earned in California?

4. For 2018 taxes (moving prior to the end of June and home sale in May) with January through mid June income earned in California would we also, use a California based CPA?

Thank you in advance,

Rosalie Taran

@Jon Quijas-Hi Jon, I own in Santa Clara and we are going to bug out of the Bay Area next summer. I just spoke with a realtor who told me the best time to get the highest price is March/April due to the lowest inventory and the most buyers looking. Good luck! 

@Linda Weygant Thank you Linda. I have a loan for $511,000 and homes in my neighborhood are selling for 1.1 to 1.4 million. I am very happy to learn it is profit after paying realtor fees, closing costs and major improvements.  

@Dan Ferguson-Good point. Thanks. I will let you know how it goes

@Dan Ferguson-Dan I appreciate all the effort you put into your reply! We will definitely buy a house outright and get rid of the $3700 a month overhead we pay for our home in Santa Clara. Another thought I had was taking a HELOC out just before the year ends and using it to buy a rental property. That would at least reduce our capital gains when we sell next spring. Thanks again!

@Bill Exeter-Bill, wow! That is great to know. I so appreciate this info! Definitely, an option on the table.