I'll try to be brief with the fact!
- My wife and I purchased a single family home in 1998
- We moved out of that home (and the state) in August 2003
- We rented the home from that point until November 2005
- We have decided to sell the home and it has been on the market (slow market) for a few months.
- I just did my 2005 tax return. The home generates a $5,000 loss with the depreciation and vacancy in 2005.
- My modified AGI is over $150,000 - so it appears that I can not take this loss whatsoever.
- I acknowledge that I can carry this loss forward as an offset to any gain I have in my sale, but I believe my gain isn't subject to tax anyway if I sell it by August 2006 - because my wife and I will have lived in the home for 2 out of the last 5 years at that point.
- This situations get exacerbated in my 2006 situation because I am paying the mortgage and taxes without any occupancy and apparently without any tax benefit!
Is there any way to change the structure of this so I can get som etax relief?