Tax law (1 viewing) (1) Guest
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Topic History of: loss on sale of house
Max. showing the last posts - (Last post first)
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Samantha
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Thanks all for your recommendations!
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steve
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Tuvok-
The US tax system works on voluntary compliance and honesty. The safety mechanism is the IRS Audit/Examination department. So, if you get audited and make an improper claim, then you will owe penalties and interest on the tax deficency. So, while you think you are saving money, if you get audited then it will cost you more than you initially saved.
So, what it comes down to is "are you a gambling man? Are you willing to take a chance and risk money, stress, and your freedom to save some $$?
If you retain a competent CPA, you can find ways to save on taxes and prepare an accurate tax return.
Remember, you have an obligation to file and pay taxes, but there is no obligation to give the US Dept of Treasury a tip!
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tuvok
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After reading this thread my question is: how would anyone be able to check on that transaction?
I'm sure that happens all the time. Why all the worry?
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OnTheGo
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I think the bigger issue you have is a tax avoidence/fraud issue. Simply changing the status of an asset, but not its characater, may expose your client and you to liability.
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steve
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Samantha,
If the taxpayer revokes the homestead exemption will the house remain the primary residence for the taxpayer? If so, then I would not make a claim that its not the priamary residence.
Also, if the taxpayer is permitted to claim a loss on the property because the property is properly classified as either investment property or rental property, then the loss will be subject to capital loss rule limits.
Also, if the primary residence looses the homestead exemption, be aware the the property tax will be re-assessed & uncapped whereby increasing the taxable value and taxes imposed.
Steven
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Samantha
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I have a question for all the tax gurus out there.
I know that you can not claim a capital loss on the sale of your residence. But what if you remove or revoke the homestead election; can you then claim that the house was not your residence?
The aim is to take a capital loss on the sale of your residence if you sell it for less that what you paid.
Just a tax saving idea. Ideas and responses appreciated.
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