Expert guidance for Florida home sellers.
When you sell a home in Florida, you may owe capital gains tax on the profit. Here's what you need to know.
Federal Capital Gains: If you owned and lived in the home for 2 of the last 5 years, you can exclude up to $250,000 (single) or $500,000 (married) of profit from federal taxes.
Florida State Tax: Florida has no state income tax, so there's no state capital gains tax on home sales. This is a significant advantage compared to states like California or New York.
Depreciation Recapture: If you claimed depreciation on a rental property, that depreciation is recaptured at 25% when you sell. Plan for this cost.
1031 Exchange: If you're selling an investment property, a 1031 exchange lets you defer capital gains by reinvesting in a similar property within 180 days.
Consult a Tax Professional: Capital gains rules are complex. Talk to a CPA or tax attorney before selling to optimize your tax position.