Reply to How to avoid capital gains tax on house sale

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Is this a second home or investment property? I’m not sure the capital gains tax applies.[/quote]
You pay tax on any gains of more than $250K if filing singly or $500K if filing jointly.[/quote]

Would the tax be long term capital gains?   What would be the the tax rate - 10%?[/quote]
I just quickly scanned a couple of websites on this and couldn’t find whether the amount over the $250K or $500K is taxed as a long term capital gain or as ordinary income - perhaps someone who’s been fortunate enough to end up in this situation can chime in.[/quote]

long-term capital gains is determined by the length of time you have held the asset. since you have to have occupied a home for at least 2 years out of 5 years to meet the primary residence test, gains that are over the primary residence exclusion would be long-term capital gains, which is 15% for most people but could be 20% if net taxable income that year is over $583k if filing jointly.

https://www.irs.gov/taxtopics/tc409#:~:text=Net%20capital%20gains%20are%20taxed,than%2015%25%20for%20most%20individuals.
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