multi-family capital gain tax in NYC.
Hello,
New to the forum, feeling very much like a newb in this whole real estate tax world. Hoping someone can help clarify some information I've gleaned from my accountant. Thanks in advance for any and all help to piece together this puzzle.
This is a scenario I'm hoping to understand.
Purchased 2-family home for 900,000. (lived in part, rented part)
Suppose a sale of 1.5million.
I am in the 28% tax bracket.
Is it true that;
I will pay 1.425% NY State Tax ($21,375)
I will pay 0.4% NY City Tax ($6,000)
I will pay Real Estate Agent Fee (suppose at 5%, $75,000)
Will the sale essentially be divided up into a 'personal residence' sale and an 'investment property' sale?
From what I understand this is what happens with the sale being split evenly between the two.
Meaning I would have a personal capital gain of 750,000-453,000 = $297,000 Since I'm married this falls completely under the $500,000 exclusion.
For the business capital gain it would be 750,000-453,000 = $297,000 Taxed at 15% capital gain = $44,550
I also have a 'depreciation recapture' of $56,000 which I think is taxed at my regular income tax rate (28% federal + 6.65%) $19,404
Generally curious to know if those numbers look ballpark correct.
Some other specific questions include;
1) Is the split between residence sale and business sale done at 50/50 or is is percentage based on living space (ie 30/70)?
2) Is the realtors fee deducted from capital gains (if so does that follow the same percentage split as discussed in question 1.
3) Probably purchasing an RV after this to use as a primary residence. Is there a way that that can help with lowering taxes.
4) Curious if there is anything big that I have missed.
Thank-you so much in advance!
Best,
Joe