Jump to content
rm.w/aview

Sell House, Buy Motorhome

Recommended Posts

As we move toward selling the house, and as we research potential RV's to live in, the issue of available money comes to mind in that when we sell the house for $100K and get an RV for $60K, will we have $40K left, (a simplified viewpoint for the sake of debate)? Will the annual tax filing be an issue to be prepared for? Is Capital Gains Tax a factor in this equation? Is a trip to the library to research this necessary, or is it really quite simple. The unknowns here have the potential to hurt me later.

Share this post


Link to post
Share on other sites

As usual this is an "it depends" situation. Get IRS Pub 551. That should clarify your tax situation.

Share this post


Link to post
Share on other sites
1 hour ago, SWharton said:

As usual this is an "it depends" situation. Get IRS Pub 551. That should clarify your tax situation.

Thank you, I just finished reading it and as I was I remembered reading it previously. It was a speed read because much of the content is unrelated and other content made my brain smoke. Many members on this forum have sold, or are selling, the house in exchange for an RV and I thought that I might get an idea of what to expect. After reading Pub 551, (& 523), I immediately thought of this forum as it is THE most helpful forum, (& mature, thank you very much). At this point I'll not commit to anything until the house is sold and the annual tax season is past, just to be safe and free of financial obligations that I may not be able to meet.

Share this post


Link to post
Share on other sites

I will start this out with: I am not a tax advisor. We getting ready to sell but we own a MH already. The MH is considered a second home and the interest is deductible. I believe there is no capital gains until it is over a certain amount. I am not sure if you  need to invest in another house within a certain time period.......

I still need to order and read 551. No rush for us as of yet.

Share this post


Link to post
Share on other sites

If you owned and lived in the place for two of the five years before the sale, then up to $250,000 of profit is tax-free. If you are married and file a joint return, the tax-free amount doubles to $500,000. The law lets you "exclude" this much otherwise taxable profit from your taxable income. This comes from the IRS, Q & A.

Share this post


Link to post
Share on other sites
4 hours ago, Kirk Wood said:

If you owned and lived in the place for two of the five years before the sale, then up to $250,000 of profit is tax-free. If you are married and file a joint return, the tax-free amount doubles to $500,000. The law lets you "exclude" this much otherwise taxable profit from your taxable income. This comes from the IRS, Q & A.

Thanks so much for this Kirk, this is very good news.

Share this post


Link to post
Share on other sites
8 hours ago, SWharton said:

I will start this out with: I am not a tax advisor. We getting ready to sell but we own a MH already. The MH is considered a second home and the interest is deductible. I believe there is no capital gains until it is over a certain amount. I am not sure if you  need to invest in another house within a certain time period.......

I still need to order and read 551. No rush for us as of yet.

I read the pdf online and it seemed that the majority of the text focused on circumstances unlike mine, which is simply a home owner/dweller. Rentals, business property, and farm land was given much attention. Like I implied earlier, I couldn't grasp a lot of the other stuff, perhaps on another day. Your post gave me hope though, as I might get slightly more for the house than what I paid for it, but probably under that certain amount you referred to.

Share this post


Link to post
Share on other sites
3 hours ago, rm.w/aview said:

Your post gave me hope though, as I might get slightly more for the house than what I paid for it, but probably under that certain amount you referred to.

Note that the $250,000/$500,000 amounts Kirk noted, above, are PROFIT, not the amount you sold the house for.

So, if your example of a $100,000 selling price is accurate, there's no way you'll come close to making that kind of profit, so you won't have to worry about paying taxes on the amount you receive for the house.

BTW, there is no longer any requirement to buy another house of equal or greater value within a certain period of time...that rule was eliminated many years ago.

Share this post


Link to post
Share on other sites

We haven't bought/sold a house in 20 years so are not aware of all the changes. I still need to get my pub but like all IRS pubs they cover many circumstances. You just need to find the sections that pertain to yours.

Share this post


Link to post
Share on other sites
3 hours ago, LindaH said:

Note that the $250,000/$500,000 amounts Kirk noted, above, are PROFIT, not the amount you sold the house for.

So, if your example of a $100,000 selling price is accurate, there's no way you'll come close to making that kind of profit, so you won't have to worry about paying taxes on the amount you receive for the house.

BTW, there is no longer any requirement to buy another house of equal or greater value within a certain period of time...that rule was eliminated many years ago.

This is all very good news for me, and gives me a great sense of relief. I can now continue my motor coach search without that dark cloud hanging overhead... Willie Nelson singing "Blue Skies" is now in my head :)

Share this post


Link to post
Share on other sites

Reading these forums are very beneficial for someone looking to go fulltime down the road. I had a friend tell me that if I sold my house I would be stuck with a huge tax fee to pay. Going on the road will require sell of house & use portion of funds to purchase our RV. Thanks for the info also even though I am piggy backing off of another member's question here. But the info also benefited me & thankful for it.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

RVers Online University

campgroundviews.com

Our program provides accurate individual wheel weights for your RV, toad, and tow vehicle, and will help you trim the pounds if you need to.

Rvonthego.com

Rv Share

Dish For My RV Military Offer.

Find out more or sign up for Escapees RV'ers Bootcamp.

Advertise your product or service here.



×