• Home
  • About us
  • Advertising
  • Digital Archive
  • Contact
    • Letter to the Editor
  • Find Us
Friday, February 15, 2019
No Result
View All Result
NEWSLETTER
Gay San Diego
  • A&E
    • Art
    • Film
    • Music
    • Books
    • Theater
    • Q Syndicate
  • News & Features
    • News
      • News Briefs
    • Politics
      • Elected Official Reports
        • Mara W. Elliot
        • Summer Stephan
        • Susan Davis
        • Toni G. Atkins
    • Features
  • Food & Drink
    • Dr. Ink
    • Foodie Flashes
    • Restaurant Reviews
  • Opinion
    • Editorials
    • Letters to the editor
  • Lifestyle
    • Fashion
    • Health & Fitness
    • The Frivolist
    • Travel
  • Columns
    • Conversations with Nicole
    • Back Out With Benny
    • Life Beyond Therapy
    • Lambda Archives
    • #LGBTB2B
    • South Bay Alliance
  • Business
    • Finance
    • Real Estate
    • Best of Gay San Diego
    • Wedding Directory
    • Expert Advice
    • Sponsored links
  • Out & About
  • Calendar
Gay San Diego
  • A&E
    • Art
    • Film
    • Music
    • Books
    • Theater
    • Q Syndicate
  • News & Features
    • News
      • News Briefs
    • Politics
      • Elected Official Reports
        • Mara W. Elliot
        • Summer Stephan
        • Susan Davis
        • Toni G. Atkins
    • Features
  • Food & Drink
    • Dr. Ink
    • Foodie Flashes
    • Restaurant Reviews
  • Opinion
    • Editorials
    • Letters to the editor
  • Lifestyle
    • Fashion
    • Health & Fitness
    • The Frivolist
    • Travel
  • Columns
    • Conversations with Nicole
    • Back Out With Benny
    • Life Beyond Therapy
    • Lambda Archives
    • #LGBTB2B
    • South Bay Alliance
  • Business
    • Finance
    • Real Estate
    • Best of Gay San Diego
    • Wedding Directory
    • Expert Advice
    • Sponsored links
  • Out & About
  • Calendar
No Result
View All Result
Gay San Diego
No Result
View All Result
Home Business

Question about capital gains taxes

October 19, 2018
in Business, Real Estate
0
Question about capital gains taxes
0
SHARES
6
VIEWS

Kathy:

My partner and I own a rental unit that is a small one bedroom, one bath condominium with one parking space in Mission Valley. We bought it in 1998. We are thinking of selling it and pulling out the equity to use for a down payment on another property. All I keep hearing about is capital gains tax.

I am not exactly sure what that means and will I need to pay it? Can you help clarify for me?

Thank you.

—Edward G.

Hi Edward:

Funny you should inquire about capital gains tax as there are new laws in effect as of this year.

First, let me help you to understand what exactly it is. Capital gains tax is referring to the profits from the sale of an asset. In real estate, people’s homes are typically their largest asset. This gain or profit is considered taxable income.

It also depends on how long you have owned it.

Short term capital gains are profits made from the sale of an asset held for one year or less. These profits would be equal to your normal income tax bracket, depending on where you fall.

Long term capital gains are the tax on profits from the sale of an asset, your home, held for more than one year. Long term capital gains tax rates are either 0 percent, 15 percent, or 20 percent, again depending on your taxable income bracket and what your filing status is (single, married, married filing jointly, married filing separately, head of household, etc.; please defer to your CPA for more clarification). Long term capital gains taxes are generally lower than short term. Typically, the longer you hold on to your asset the better the tax benefits.

If you own two properties and make a profit on one for $10,000, and a loss on another for $4,000, your net gain is $6,000. That $6,000 is typically taxed as additional income according to your tax bracket.

But, there are rules and exceptions. Check with your tax expert or CPA for more detailed information on your taxes to be paid.

As of 2018, the deduction for state and local taxes, also known as the SALT deduction, will not be offered to taxpayers. In the past, SALT deductions have been lucrative for taxpayers, particularly in high-tax status states like California, New York and New Jersey. This deduction includes not only property taxes, but state and local income tax or sales tax. This was a very contentious part of the tax reform process. Now, even though Republicans wanted to do away with the tax entirely, they put an annual cap on the deduction.

The cap is now $10,000. For instance, if you live in NY, let’s say the average SALT deduction was $21,000; now your deduction just got cut in half. However, they nearly doubled the standard deduction. (Deductions that do not have to be itemized.)

Anyone who itemizes can deduct their property taxes, but people filing must choose between deducting their income tax or their sales tax. Residents of states with high income tax, like California, generally opt to deduct their state and local income taxes if they itemize. Residents of states with high sales tax like Texas and Louisiana and low or nonexistent income tax, generally elect to deduct their sales tax. So, property taxes and income taxes – not sales taxes – are the primary forces behind the SALT deduction. Remember, the higher your income, the more taxes you pay and therefore the more deductions you want to take to help offset a higher tax rate.

Edward, I know it can seem daunting and confusing but regardless of the changes, your home is typically your biggest asset and you want to be able to take advantage of the most tax savings and benefits available. Consult your CPA or tax attorney and they will be able to help you maximize the most tax saving benefits. I hope this helps to understand some of the changes that happened this year. Best of luck.

—Kathy McSherry is a Realtor at Coldwell Banker Residential Brokerage. Email your questions to kathy@kathymcsherry.com, or call 702-328-9905.

Next Post
Brewed, cooked and served with ‘meraki’

Brewed, cooked and served with ‘meraki’

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

More from SDCNN:
Mission Valley News: Church celebrates 150 years
Downtown News: ‘Thar she blows!’
Mission Times Courier: A holistic approach to fitness
La Mesa Courier: Report on police incident at Helix draws ire
Uptown News: Into the Uptown jungle

Follow us on Instagram!

  • It   s that time of year again  Our Best of Gay San Diego 2019 ballot is now open  Vote for your favorite dining and entertainment venues  and businesses and retail establishments  Link in bio              BestOfGaySD  BestOfAwards  GaySanDiego
  • A new issue of  gay sd comes out this Friday  Are you caught up on the last paper  Link in bio        gaysd  gaysandiego  lgbt  sandiego  hillcrest  gaynews
  • Miriam s Tea Party s sirens beckoned us to the depths of Dumb Disney last Saturday night
  • Happy Friday Gay San Diego  This issue we discussed the mental aspects of gender transition  featured a profile on HTC Arts Committee chair Erik Benson  gave you some political updates like news of Todd Gloria   s mayoral run and unveiled our new website  Visit gay-sd com to stay up to date on what   s happening in your community
  • Chrissy LaBrecque and her longtime partner Andrea Roehl just spent their first Christmas with their new 5-month-old baby  Camden  in North Park  Like many new parents  they quickly found out that he was mostly interested in the packaging of the presents under the tree rather than the toys  but they enjoyed the holiday spending time together with Camden and their family for the holiday                              However  the past five months have not been easy for the couple as they have had to traverse through California law to get LaBrecque  Camden   s biological mother  on Camden   s birth certificate   Link in Bio
  • Happy Friday readers  Our first 2019 issue features a cover story about the struggle of a same-sex couple who were not allowed to list both of their names on their baby s birth certificate due to current CA law  Much more up on the website     link in bio
  • The first 2019 issue of Gay SD is out tomorrow morning  In the meantime  get caught up on stories from last issue including the full list of 2018   s Nicky Award winners  Head on over to our website  link in bio
  • Let   s bring in 2019      This year we covered new events  launched a new website  created an Instagram and listened to shared your stories to our community  Thank you for    liking        following    and reading our  GaySanDiego  What are you looking forward to in 2019  Comment below  we   d love to hear
  • HAPPY NEW YEAR GAY SAN DIEGO  This year we sent our editor  Albert H  Fulcher   OUTandAbout in San Diego to capture you at your favorite events  fundraisers and festivals  Were you seen OUT   About  Visit gay-sd com category out-about  to view photo galleries from events including Pride  the Red Dress Party  Nightmare on Normal Street and more

Like us on Facebook:

Gay San Diego

10 hours ago

Gay San Diego

The Imperial Court de San Diego held its Coronation 47 Feb. 7-10, bringing International Imperial Court System leaders together for international business and the investure of the 47th reign of our local ambassadors. ...

A new reign crowned

gay-sd.com

On Saturday, Feb. 7, it was a royal evening of awards and performances, voting in the new reigning monarchs
View on Facebook
·Share

Gay San Diego

© 2019 Gay San Diego. All rights reserved. San Diego Community News Network (SDCNN)

Navigate our site

  • About
  • Advertise
  • Contact

Follow Us

No Result
View All Result
  • A&E
    • Art
    • Books
    • Film
    • Music
    • Theater
    • Q Syndicate
  • News & Features
    • News
    • Features
    • Politics
      • Elected Official Reports
      • Susan Davis
  • Food & Drink
    • Dr. Ink
    • Foodie Flashes
    • Restaurant Reviews
  • Opinion
    • Editorials
      • Letters to the editor
  • Lifestyle
    • Fashion
    • Health & Fitness
    • The Frivolist
    • Travel
  • Columns
    • Conversations with Nicole
    • Notes from Toni
    • #LGBTB2B
    • Back Out With Benny
    • Life Beyond Therapy
    • South Bay Alliance
  • Business
    • Finance
    • Real Estate
    • Best of Gay San Diego
    • Expert Advice
    • Sponsored links
  • Out & About
  • Contact
  • Archive
  • About
  • Advertising
  • Calendar

© 2019 Gay San Diego. All rights reserved. San Diego Community News Network (SDCNN)

Login to your account below

Forgotten Password?

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In