Call Melanie! (I have a thing for Melanie…)
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thanks, will call her up after talking to my broker. will do some comparison, what’s the market commission now?
thanks dragonboy
Is this your noisy tenant house?
Yup. Just moves out and realcim the house back. Got some damage but nothing serious. Security depoait should be able to cover most if it. And lucky no smell
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Are you sure you will get the full $500k capital gains exclusion? I thought it was prorated based on the time used as a rental, so if you lived in it for 5 yrs and rented for 3 yrs you would only get to deduct ~$312k. (We also have a primary that was turned into a rental and chose not to sell it for this reason. The plan now is to eventually 1031.)
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Not everybody is from a place that is not as good as USA 
Hong Kong has very good night life and excellent Cantonese food. Best is I can flirt with the women without being sued or accused of inappropriate behavior.
No proration if you bought it as primary and later converted to rental.
Even I need to check on that one. There may be a time limit at which point if you rent it too long you may end up losing some/or all of that 500K. Unfortunately, this is not my IRS buddy’s specialty but I guess he can find out the answer.
You clearly have zero experience with HK women.
changing topics again, back to woman…
i read about it. so far what i found
- at least i will quality for 2/3+ of the 500k
- i only able to find convertion from rental to primary(2/5) which will be prorated. but nothing from primary to rental.
found some more
Scenario 1: When Bob bought his house in 2003, he moved in right away. He lived there until January 1, 2016, and started renting it out after that. He plans to keep it rented until he sells it.
So long as he sells it before January 1, 2019, all of his use is “qualified use” under § 121. The last three years of rental property usage is included in “qualified use” under § 121(b)(5)©(ii). That means all of his capital gain is potentially eligible for the exclusion.
This is what my buddy said:
A married couple must live in the property for the required amount of time within the previous five years. So, look at today, go back 5 years and if the couple lived in the property in any of the two years of the previous five, and it does not have to be consecutive years, they qualify for the $500K exclusion. Only one sale every two years is allowed.
I plan to get the code section and irs publication from him…
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Under IRC §121(b)(5)©(ii), the period of nonqualified use doesn’t include the portion of the 5-year period which is after the date that the taxpayer last used the property as a personal residence. As a result, there’s no nonqualified use if a taxpayer converts the principal residence to a rental, then after a few years sells it. But there is nonqualified use if the reverse happens (rental to principal residence).
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we all gonna be 121 expert by the end of this thread haha
Right, which is my concern (rental to primary scenario).
i think i’m good. should qualify for full 500k,
so lesson we learn
- buy a primary and live for 2 yrs before renting
- live in primary for 2 yrs, rent it out, don’t live back in it.
what else.
Don’t cheat on your wife or the whole calculation goes to hell anyway…
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For @harriet, it’s better to buy a rental and rent it for some years. Then move in to make it a primary home. When the appreciation is 700k, she can get 250k tax free capital gain and 1031 the other 450k rental capital gain.
Since many couples have a much larger gain than 500k, they can also use this strategy.
If you buy a primary home and let it appreciate by 1M. These is no way to avoid paying tax on the 500k captial gain.
So if you are optimistic about sizable appreciation, you better buy the house as rental.