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Kevin Kim
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Primary Home Keep as rental or Sell to avoid future tax

Kevin Kim
Posted Oct 25 2021, 16:52

Hello 

I will be purchasing new primary home and keep my current primary home as rental or not due to the tax benefit.

Home location: East Bay, CA

Capital Gain: around $200,000 (Purchased 2018 and lived 3 yrs as primary home)

My original plan was once I purchase new home, I was going to keep it as rental. But once I learned capital gain exclusion rules ( up to $500,000 of that gain if you file a joint return with your spouse), I am confusing if I need to sell so I still get some tax benefits now or keep as it rental for 2-3yrs (can sell within 3yrs to meet the capital gain exclusion rules) or even hold even longer (pay long term gain tax in this case.)

I want to invest another investment property using 30yr fixed loan even if I sell now and I am kind of confuse what will be best direction here.

Can anyone advice if you have any insight?

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