The Miami real estate market is still booming! Home prices seem to be increasing overnight, and it is very tempting for many homeowners to cash out while the demand is exceptionally high. I am encouraging everyone to sell because we do not know how long this market will last, and the question that I am hearing a lot is: what about capital gains taxes?
While I am not a tax expert by any means, I did pull together some information about capital gains. I would always encourage you to speak to a tax professional before making any decisions, but the bullet points below give you some insight into capital gains.
– Each person, regardless of income, receives a $250,000 Capital Gains Tax Exemption if they meet the following requirements:
- Home is their primary residence
- Have owned the home for 2+ years and resided in the home for 2 of the past 5 years
- Must not have taken the exclusion in the past 2 years
- Partial exclusions may be available to those who do not meet all of these requirements – consult a tax advisor for more information
– Capital Gains Tax Rates:
- Single Individuals:
- 0% for incomes below $40,400 in 2021
- 15% for incomes between $40,401 and $445,850
- 20% for incomes over $445,851
- Married Couples Filing Jointly:
- 0% for incomes below $80,800
- 15% for incomes between $80,801 and $501,600
- 20% for incomes above $501,601
Hopefully this information helps you make up your mind as to whether you will stay in your home or sell in this hot real estate market!