If you’re selling your home in Massachusetts, you may be wondering about how to avoid capital gains tax. Luckily, there are some ways to potentially exclude up to $250,000 in gains from the sale of your home, or up to $500,000 if you’re married. Here are some eligibility requirements and tips to keep in mind:
Residency: You or your spouse must have lived in the home for at least 2 out of the 5 years preceding the sale.
Ownership: You must have owned the property for at least 2 out of the 5 years preceding the sale.
Exclusion Frequency: You may only exclude capital gains tax from the sale of a home once every 2 years.
Reason for Sale: The home must have been your primary residence and not a rental property or second home.
It’s important to keep detailed records of your residency and ownership to ensure eligibility for the tax exclusion. Additionally, if you’re unsure about any aspects of the process, consulting with a tax professional can provide valuable guidance.
By following these guidelines, you may be able to exclude capital gains tax on the sale of your home in Massachusetts.