Selling rental

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Topic Author
genefl
Posts: 33
Joined: Wed Feb 05, 2014 10:32 am

Selling rental

Post by genefl » Sun Apr 14, 2019 3:30 pm

Hello,

Appreciate any tips.

Selling my rental house to my tenant. I originally purchased it in 2007 as our primary house. It has been a rental since August 2014.

The sale price is exactly my purchase price. Gain on the sale of the property will be roughly 145k. My accountant estimates about 29k in taxes on the sale. I tax loss harvested about 40k in January. This reduces the 145k gain to 95k correct? Or is it deducted against the tax of 29k?

Assuming I have a roughly 95k taxable gain and 19k tax liability, any thoughts on how to limit the taxes? Don’t want to get another property to manage. Are there possible options to do a 1031 exchange into a fund? Other suggestions? Just take the tax hit and put it into the market? I subscribe to the 3fund portfolio approach.

Thanks in advance!

Dottie57
Posts: 5739
Joined: Thu May 19, 2016 5:43 pm

Re: Selling rental

Post by Dottie57 » Sun Apr 14, 2019 3:34 pm

If purchase price = sale price how can there be a capital gain?

stats99
Posts: 126
Joined: Wed Sep 28, 2016 2:15 pm

Re: Selling rental

Post by stats99 » Sun Apr 14, 2019 3:39 pm

Dottie57 wrote:
Sun Apr 14, 2019 3:34 pm
If purchase price = sale price how can there be a capital gain?
I assume depreciation recapture?

Dottie57
Posts: 5739
Joined: Thu May 19, 2016 5:43 pm

Re: Selling rental

Post by Dottie57 » Sun Apr 14, 2019 3:42 pm

stats99 wrote:
Sun Apr 14, 2019 3:39 pm
Dottie57 wrote:
Sun Apr 14, 2019 3:34 pm
If purchase price = sale price how can there be a capital gain?
I assume depreciation recapture?
Thank you. I know nothing about rentals! :happy

Topic Author
genefl
Posts: 33
Joined: Wed Feb 05, 2014 10:32 am

Re: Selling rental

Post by genefl » Sun Apr 14, 2019 3:55 pm

Correction, 145k to 105k. And yes, depreciation recapture. :)

User avatar
Sandtrap
Posts: 6225
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii😀 Northern AZ.😳 Retired.

Re: Selling rental

Post by Sandtrap » Sun Apr 14, 2019 4:02 pm

Why not selling for more?
Why sell to tenant vs open market?
1031 is only for like property of equal or higher value.

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