tax question

[lavagirl]

Does anyone know what the tax implications are for selling a rental property as well as your home in the same year? Thanks in advance!

[MDM]

Anywhere from "none" to "significant" depending on the specifics.

E.g., how much depreciation recapture on the rental, capital gains on both, purchasing/not purchasing other rental and/or residence property, etc.?

[lavagirl]

The rental I'll be selling for 40k less than I bought it for.  Our house, we might make around 30k and would move to a rental.

[MDM]

I'm going to guess "not a significant impact" but you might want to buy yourself a copy of TaxAct for ~$25 and run the actual numbers.  Or use whatever other software you prefer - or even do it by hand. :)

[zephyr911]

The rental I'll be selling for 40k less than I bought it for.  Our house, we might make around 30k and would move to a rental.

How long did you hold the rental? How much depreciation have you claimed over the life of the property? If you didn't claim it, how much could you have claimed? The IRS is mean about that.

https://ttlc.intuit.com/questions/2553574-depreciation-recapture-on-sale-of-rental-property-for-gain

If you lived in your current primary residence for 2 of the last 5 years the sale is probably exempt from capital gains.

If you move into this particular rental and live there for 2 years instead of selling it, you might be able to do the same thing.