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There is a tax exemption on your first 250k of capital gains when you sell your house. The interest on your mortgage is tax deductible. If home prices increase
by singron 2y ago
There is a tax exemption on your first 250k of capital gains when you sell your house. The interest on your mortgage is tax deductible. If home prices increase 10% each year, then you can maximize earnings by moving to a more expensove house every few years.
In this way, your home is like a leveraged tax sheltered investment, and the limits are much higher than an IRA.
- ta1243 2y agoSo if you buy a house for 200k, keep it for 30 years and sell for 700k, you have to pay tax But buy a house for 200k, sell after 15 years for 450k, buy a new one for 450k, then sell that after 15 years for 700k, you pay no tax?
- noodlesUK 2y agoIn the U.S., yeah that’s how it works.
- lotsoweiners 2y agoIn the US most people file taxes with the standard deduction since 2017. I’ve been homeowner with a mortgage since 2005 but haven’t gotten a mortgage deduction in like 6 years. https://www.cnet.com/personal-finance/taxes/should-you-itemize-your-taxes-instead-of-taking-the-standard-deduction/ https://www.cnet.com/personal-finance/taxes/should-you-itemi...
- ta1243 2y agoAhh, so it seems that mortgage interest payments come off before tax?!