Posted by Kristine-CA on October 30, 2009 at 12:25:55:
In Reply to: Re: New Capital Gains for primary residences 2009 posted by Natalie-VA on October 30, 2009 at 09:04:18:
Hi Natalie. It appears that the new law applies to all primary
residences, not just those acquired via 1031 exchange. So time after
Jan 2009 that the property is used for rental vs. residence is allocated
to the portion for which one owes capital gains.I'm trying to figure out the proration, though. I think the formula is
the number of days owed total divided by the number of days used as
non primary residence.IMO this law really changes the deal for the average homeowner in a
bad way. It means that the person with a home that doesn't sell easily
and who rents it out for a few months or a year while they figure out
what to do with it will be paying capital gains on that time.