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Hello, thanks in advance of any help you can offer. I aplogize for being verbose.
I am selling a long-term single family house in Oregon that my wife and I have owned for ~31years, it has been a rental for the last ~27 years. We have another house in the area that is also a rental at present.
We lived in Maui from 2008 until 6/2015, when we returned to the rental as our primary residence.
We have completed a renovation and the house is listed to sell.
My concerns are, of course minimizing CG taxes.
Since returning to Oregon in 2015, I have worked part-.time as an independent contractor, living in various parts of Oregon for several months and returning to the house to live between contracts. I am leaving to return to Hawaii in one week for a 12 month contract.
We have received an attractive offer and the house will likely sell while we are away. We bought the house in 1985 for $42,500. We owe ~$68,000. It will sell for ~$245,000, for approximately $170,000 gross tax liability after commissions, etc.
The house is is fully depreciated, I believe on a 27&1/2 year schedule.
I am 62 years of age and will be so at that estimated time f sale.
I will make approximately $110,000 this year. My wife does not work for money but manages our lives.
Renovation costs were approximately $30,000 in materials; I did the majority of the labor.
My questions:
1. How does my working out of state in the past and for the next 9-12 months affect the 2X365 days rule for determining type of residence: primary or secondary? Is this considered a rental property, given the particulars above?
2. If this is considered a rental, how does my upcoming out-of-state travel affect determination of residence-type and any pro-ratia of taxes determination?
3. Does my eligibility for Social Security have an impact?
4. Can I deduct a reasonable amount of payment for my own labor in the renovation performed?
5. What questions am I not considering here for minimizing taxes?
Thanks again.
James
I am selling a long-term single family house in Oregon that my wife and I have owned for ~31years, it has been a rental for the last ~27 years. We have another house in the area that is also a rental at present.
We lived in Maui from 2008 until 6/2015, when we returned to the rental as our primary residence.
We have completed a renovation and the house is listed to sell.
My concerns are, of course minimizing CG taxes.
Since returning to Oregon in 2015, I have worked part-.time as an independent contractor, living in various parts of Oregon for several months and returning to the house to live between contracts. I am leaving to return to Hawaii in one week for a 12 month contract.
We have received an attractive offer and the house will likely sell while we are away. We bought the house in 1985 for $42,500. We owe ~$68,000. It will sell for ~$245,000, for approximately $170,000 gross tax liability after commissions, etc.
The house is is fully depreciated, I believe on a 27&1/2 year schedule.
I am 62 years of age and will be so at that estimated time f sale.
I will make approximately $110,000 this year. My wife does not work for money but manages our lives.
Renovation costs were approximately $30,000 in materials; I did the majority of the labor.
My questions:
1. How does my working out of state in the past and for the next 9-12 months affect the 2X365 days rule for determining type of residence: primary or secondary? Is this considered a rental property, given the particulars above?
2. If this is considered a rental, how does my upcoming out-of-state travel affect determination of residence-type and any pro-ratia of taxes determination?
3. Does my eligibility for Social Security have an impact?
4. Can I deduct a reasonable amount of payment for my own labor in the renovation performed?
5. What questions am I not considering here for minimizing taxes?
Thanks again.
James