I thought I’d never use the words “IRS” and “mercy” in the same sentence but I’m going to do so now… If circumstances force you to move out of your home before you qualify for the $250,000/$500,000 exclusion, the IRS will show you mercy and help you out. That’s right. In a rare moment of kindness, the IRS may lend you a helping hand and reduce your tax burden if you can show … [Read more...]
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When a house won’t sell, consider a lease-option
Trying to sell a house that’s sitting on the market without attracting a decent offer? Don’t give up. Think creatively and use a lease-with-an-option-to-buy strategy to get the cash flow flowing! When you find the right tenant, this arrangement can make sense for everyone concerned. But beware. There are tax traps that you’ll need to avoid if you want to come out a winner. … [Read more...]
How to slash your tax bill when you sell your home
Thinking about selling your current home or vacation property any time soon? Then my new article is for you! You see, I’ll explain easy steps you can take right now to prepare for (or completely avoid!) the tax hit you may have to take when you sell. For example, I’ll explain why you should never rely on the home-sale gain-exclusion to shield all of your profit. And I’ll … [Read more...]
The surprising “Case of The Built-in Desk”
A little while ago I was asked an interesting (if arcane) question by a long-time reader of the Tax Reduction Letter. The gentleman who wrote me recently installed a built-in desk in his home office. He also had a built-in desk installed in a personal (non-business) part of his home. His question? How should he treat the two built-in desks for tax purposes? You’ll hear … [Read more...]
Don’t miss taking vacation-home “repair days”
A vacation home should be a place where you can relax carefree. But before you hit the hammock, you should know a little tax law… The tax treatment of your vacation home depends on two things: The number of days you rent it out at fair market value The number of personal-use days One way to get a nice tax break is to take advantage of “repair days.” You see, repair … [Read more...]