Housing Assistance Tax Act of 2008
There is more to the Housing Assistance Tax Act than you might be aware of. In addition to the tax credit for first time buyers, changes were made to the “two out of five year rule”.
• Tax credit of up to $7,500 for first-time homebuyers, to be repaid over 15 years.
• Additional property tax deduction for those that don't itemize.
• Prorated capital gains exclusion for real estate for periods of non-primary use.
When homeowners sell their primary residence, they can exclude up to $500,000 in capital gains from income tax. The Housing Assistance Tax Act of 2008 alters this rule. The amount of profits from the sale of a house that can be excluded is now based on the percentage of time when the house was used as a primary residence.
If you have converted your former primary residence to a rental this may negatively impact you. I am a Realtor, not a CPA, please contact your CPA or accountant if you think this applies to you (I don’t have the expertise to offer tax advice). Read more here
• Tax credit of up to $7,500 for first-time homebuyers, to be repaid over 15 years.
• Additional property tax deduction for those that don't itemize.
• Prorated capital gains exclusion for real estate for periods of non-primary use.
When homeowners sell their primary residence, they can exclude up to $500,000 in capital gains from income tax. The Housing Assistance Tax Act of 2008 alters this rule. The amount of profits from the sale of a house that can be excluded is now based on the percentage of time when the house was used as a primary residence.
If you have converted your former primary residence to a rental this may negatively impact you. I am a Realtor, not a CPA, please contact your CPA or accountant if you think this applies to you (I don’t have the expertise to offer tax advice). Read more here
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