Capital Gains & W2 income
A scenario from a family member:
I plan on selling a family home that has appreciated over the last 20+ years. I will talk to a tax attorney. I am considering quitting an unfulfilling job to look into starting a new business in the next year. Given some family circumstances earlier this year, I took a bit of time off work so if I quit soon, I would have made under 48k in W2 income, which would put me in the 0% capital gain tax rate. I did receive about 25k from a life insurance policy. My domestic partner will have me on his work health insurance, we just need to get that started. I am looking for guidance in what else I should be looking at or ask the tax attorney? I would have to quit my job very soon and that is making me both excited and nervous. Anyone dealt with a similar situation? Are there more things I need to consider? Thank you.
Most Popular Reply
@Terri P. Don't let the tail wag the dog. Quitting you job to save on taxes may not be the best idea. It might make sense but talk to a good tax professional.
If you have lived in the "Family Home" for 2 out of the last 5 years there is a capital gain exclusion $250 or $500k depending on filing status.