Myth - I'm don’t want to sell my home, because I don’t want to pay a lot of money in tax

Myth - I'm don’t want to sell my home, because I don’t want to pay a lot of money in tax

I'm not selling because I don't want to pay those high taxes. That's today's myth. How true that myth is. Welcome to another episode of Myth vs the Truth.

Okay, so let's discuss, you're paying a lot of taxes. But think about this. The market is perfect right now where you're getting high value for your home. So you're going to be paying just a little bit more in taxes, but the return is going to be far greater than that. Now, let's talk about the other aspect of things. When have we ever seen taxes go down? Never. Right. So if we don't take advantage of the moment that we have in front of us today, who's to say what will happen?

Also, you have to remember that the capital gain taxes you pay only on the investment properties. Also, if you hold the property for a longer time, the percentage of taxes are lower than if you sell within a year. Now, if you have a primary home and it's owned by a couple, husband and wife, two people, it's a homestead property. If you live in that property for at least two years, in the last five years, you have an exemption. You do not have to pay together any taxes on $500,000 profit. That means after paying the mortgage and all the expenses, the net profit to your bank account up to $500,000. So 250k and 250k, you're exempt. So remember that.

Let's talk about investors. Also, when you sell your property you've to pay taxes, of course. But you can also do something called 1031 Exchange. What that means is that you can sell your property and the profit from the property, you can put it in an attorney trust account so you have certain time to buy your next property. And guess what? On 1031, you have to pay zero taxes. So the money that you get from one property, you can roll over to the next property. If you have any questions about that, give us a call and we will be more than happy to discuss. We have classes about it.

We can get in contact with the attorney and we can guide you. I hope you found this information helpful and steer away that fear you have and take advantage of today's market. See you next week in another episode of Myth vs the Truth.