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Selling Your Home(s) (404)
Author: Holmes F. Crouch
Pages: 224
List Price: $19.95
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  • Summary

    SELLING YOUR HOME (T/G 404) covers selected old law matters for comparison with new law; mixed spousal sales; the unprecedented exclusions on each sale (how to compute and claim them); the exclusionary frequency every 2-plus years; and the many "special circumstance" rules that apply. Also covered:

    • Detailed overview: new Section 121
    • Role of "real estate reporting persons"
    • Importance of Form 2119 on each sale
    • Effect of divorce & business use
    • Why loss sales not tax recognized
    • How to parlay your nest egg

    Table of Contents
    Selling Your Home
    Book:  404
    
    Table of Contents   
    
    1.  OLD LAW BACKGROUND                                  1-1
    
        The Evolution of Section 1034                       1-2
        A General Misconception                             1-4
        Gain “Rolled Over” Only                             1-6
        Total Reinvestment Unnecessary                      1-9
        Frequency of Sales Limited                          1-10
        Report Loss Sales, Also                             1-12
        Former Section 121 Exclusion                        1-14
        Exclusion Must Be “Elected”                         1-15
        Age & Spousal Inequity                              1-16
        Two Exclusions Possible                             1-17
    
    2.  BACKGROUND RULINGS                                  2-1
    
        Synopsis of Prior Rulings                           2-2
        Introduction to Snowa Case                          2-4
        The Relevant Snowa Facts                            2-5
        Section 1034 (g):  The Issue                        2-6
        The IRS Position                                    2-7
        Analysis by the Court                               2-8
        Example T.C. Memo Rulings                           2-11
        Example Section 121 Rulings                         2-12
        Ownership & Use Case                                2-14
        Mixed Business & Personal Use                       2-16
    
    3.  NEW LAW OVERVIEW                                    3-1
    
        The Exclusion: $250, 000 Per                        3-2
        What Congress Said                                  3-4
        Married Filing Jointly                              3-6
        Meaning of “Sale or Exchange”                       3-8
        When Less Than 2 Years                              3-10
        Clarifying an Ambiguity                             3-13
        Other Prorata Exclusions                            3-15
        The “Whole Works” Outlined                          3-16
    
    4.  SPECIAL SITUATION RULES                             4-1
    
        Within or Near the “Gap Period”                     4-2
        Within 2 Years After Enactment                      4-4
        Sale of Remainder Interests                         4-5
        Periods of Out-of-Residence Care                    4-7
        Property of Deceased Spouse                         4-8
        Tenant-Stockholder in Co-op Housing                 4-10
        Equity Sharing Arrangements                         4-11
        Reacquired Residence Resold                         4-12
        Joint Returns with Unforeseens                      4-14
        Overwhelming “Relief” Intent                        4-16
    
    5.  BROKER REPORTED SALES                               5-1
    
        Introduction to Section 6045(e)                     5-2
        Statement Furnished to You                          5-4
        Exception for “Certain” Sales                       5-6
        IRS Announcement 97-106                             5-8
        Title Passing Is “Sale”                             5-9
        Sale Procedures Confusion                           5-10
        Clarify Co-Owner Percentages                        5-13
        Culling Those Papers                                5-14
    
    6.  BASIS OF RESIDENCE SOLD                             6-1
    
        Methods of Acquisition                              6-2
        Must Be “Principal Residence”                       6-4
        Surrounding Acreage Limited                         6-5
        Term “Basis” Defined                                6-6
        Basis When Purchased                                6-8
        Personal Items Discounted                           6-10
        Basis When Gifted                                   6-11
        Basis When Inherited                                6-13
        Improvements Add to Basis                           6-15
        Adjustments to Basis                                6-17
        Basis Rules Summarized                              6-18
    
    7.  CLAIMING YOUR EXCLUSION                             7-1
    
        Exclusion Not Automatic                             7-2
        The “Exact Matching” Trap                           7-3
        Escrow Closing Statement                            7-4
        Overview of Form 2119                               7-6
        Exclude Personal Items                              7-8
        Selling Expenses: Escrow                            7-10
        Expenses Outside of Escrow                          7-11
        Establishing Your Gain                              7-11
        Apply “Proper” Exclusion                            7-13
        Gain in Excess of Exclusion                         7-16
    
    8.  EFFECT OF DIVORCE                                   8-1
        
        Date of “Final” Important                           8-2
        Property Settlement Terms                           8-4
        Attorney Fees and Debt Liens                        8-5
        Transfer Between Spouses                            8-6
        Basis to Transferee Spouse                          8-8
        When Not to Quitclaim                               8-9
        New Special Rule:  Sec. 121(d)(3)                   8-10
        Move-Out Spouse’s Use Period                        8-12
        The 50/50 Presumption                               8-14
        Non-50-50 Fractional Interests                      8-16
        Negotiate for Separate 1099s                        8-18
    
    9.  PRORATA BUSINESS USE                                9-1
    
        New Law Reminder                                    9-2
        It’s Like “Two Sales”                               9-4
        The “Business Use” Question                         9-5
        Introduction to Form 4797                           9-6
        Office-in-Home Depreciation                         9-7
        Sale With Rental Unit (s)                           9-11
        Sale With Subdivided Land                           9-13    
        Allocation in Sales Contract                        9-14
    
    10. INVOLUNTARY CONVERSION                              10-1
    
        What Section 121 Says                               10-2
        Introduction to Section 1033                        10-3
        “Threat or Imminence” of Condemnation               10-5
        Replacement Period Misjudgments                     10-7
        Back to Section 121(d)(5)(B)                        10-9
        Holding Period Tack-On                              10-10
        Election to Replace…or Not to                       10-12
        Presidentially Declared Disasters                   10-14
        Read Insurance “Fine Print”                         10-15
        How to Tax Report                                   10-17
        
    11. TREATMENT OF LOSSES                                 11-1
    
        How Loss is Determined                              11-2
        Scenarios for Loss                                  11-4
        Overview of Section 165                             11-5
        Subsections (a), (b), & (c) Explained               11-7
        Introduction to Form 4684                           11-9
        Disaster Loss Election                              11-10
        NOL Carryback Years                                 11-12
        Conversion To Rental Residence                      11-14
        Principal Place of Business                         11-15
        
    12. PARLAYING YOUR NEST EGG                             12-1
        
        Section 121 (New) Revisited                         12-2
        No Gimmick Tax Accounting                           12-4
        Lifespan of Home Ownerships                         12-7
        Better than IRAs, 401(k)s, SEPs, etc.               12-8
        Maximizing Exclusion Amounts                        12-10
        Set Goal to Pay Off Mortgage                        12-11
        Indexing Your Cost Basis                            12-13
        Selling & Buying Lower                              12-15
        Your “Final” Sale                                   12-17

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