How to Avoid Capital Gains Tax When Selling Your Home

    SAN FRANCISCO, CA, August 27, 2015 /24-7PressRelease/ -- Long time Foster City resident and Intero Realtor, Gwen Chua, has partnered with the San Francisco Chapter of the California Society of Tax Consultants (CSTC) to help sellers reduce or defer their capital gains tax.

Sellers Unaware of Tax Consequences

According to Gwen, a common question that sellers ask is, "How much in taxes will I have to pay?" Because a real estate transaction can be a daunting and complex process for many, it is easy for a homeowner to overlook the tax burden involved in selling a property. Although many sellers are pleased with how quickly their properties have appreciated here in the San Francisco Bay Area, they are unfamiliar with the elusive topics regarding capital gains, as well as tax deferral strategies. "Oftentimes, clients have no idea what a tax consequence may entail until long after the property has been sold," says former CSTC President, Morris Miyabara.

Significant Taxes on Real Estate Sales

Currently, for married couples in the 25% income tax bracket, long-term capital gains are 15% IRS, 13.3% California, and 3.8% for Obamacare. Including the Affordable Care Act, the long-term capital gains rate is approximately 32.1%. By implementing a properly structured sale strategy, property owners could easily keep more of their hard earned money. As the San Francisco Bay Area home value appreciation remains strong, Gwen noticed that an influx of sellers are unaware of the substantial impact capital gains tax can have on their net proceeds.

How to Reduce or Defer Taxes When Selling a Home

The following are ways in which sellers could reduce or defer their taxes:

Capital gain exclusion for primary residence: Applies to individuals that have used their properties as their primary residence. Exclusion is $250,000 and $500,000 for single and married individuals, respectively.

Tax deferred exchange, commonly known as 1031 exchange: Applies to properties that are used for investment purposes. Personal residence, converted to rental income property may also apply with strict guidelines.

Deferred Sales Trust: Allows property owners to defer taxation on the sales of their properties. Applies to investment properties and personal residence.

Gwen attends continuing education classes with the San Francisco Chapter of the California Society of Tax Consultants on a monthly basis. Accountants, CPAs, and EAs attend these meetings and provide a wealth of information and experience. If you would like to learn more, please do not hesitate to contact Gwen (www.GwenRealty.com) as he would like to invite any potential seller, as his guest, to attend a meeting to address any tax questions he or she may have.

About Gwen
Gwen Chua, a seasoned agent in the business, has sold properties ranging from condo and townhouses to single and multi-family investment apartments primarily in San Mateo County and San Francisco.

Gwen Chua
Intero Real Estate Services
650-255-1511
[email protected]

About Intero Real Estate Services
Intero Real Estate Services, Inc., a Berkshire Hathaway affiliate and wholly owned subsidiary of HomeServices of America Inc., serves Northern California with 13 offices throughout the greater Silicon Valley. The Intero Franchise network is comprised of nearly 50 affiliates located in Alabama, Arizona, California, Colorado, Nevada, Tennessee and Texas. The company is headquartered in California's Silicon Valley.

About California Society of Tax Consultants
The California Society of Tax Consultants, Inc. (CSTC) has been a nonprofit organization for the benefit of tax professionals throughout California since 1966. Programs cover a wide spectrum of tax topics that are approved for CTEC, EA & CPA credit.

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