Selling in under 1 year of ownership

[Katy King]

I just bought my first home July 2018, I currently live in half & have a tenant with a 1 year lease(Sept. 1, 2018-Sept. 1, 2019) in the other half. I am considering selling soon. What are my options? Do I have to own for 6 months? My income bracket is $55,000-60,000 so is up to 250k profit tax free? Bought the home for 155,000 want to resell for about 200,000/225,000. Replaced furnaces, electrical, cosmetic improvements, & added a bedroom to increase value, etc. House is 1990 sq. ft, 2 units: 2/1 & 2/1. 

[Lynnette E.]

Unless you have a restriction on selling the house in your purchase agreement like if it is a HUD, Fannie Mae, etc. home, you can sell it when you want to.

But if you own it less than a year you will pay short term capitol gains taxes.  You do not get any amount of tax forgiveness unless you lived in the house at least 2 years out of the past 5 years.  That is what the $250k you wrote refers to.

But you are not likely to have enough profit to worry about --that $50k to $75k increase in sales price is not all profit.  Subtract the cost you incurred in buying, the cost of the rehab and maintenance and the cost in selling and you have very little profit....and with 2 units even if you did live it in for 2 years, you do not get to totally not pay taxes on the capitol gains as its a duplex.