vicki.wells[at]modot.mo.gov posted:

- quote -

There is no "offset" for the sale of current property, as a
result of a new purchase. I think you're flashing back to
old tax laws that changed about 1997 -- when we used to be
required to "roll over" the original cost basis of a home
into a new home purchase. NOT true anymore.

As others have pointed out, the exact details of the "Main
Home" property are unclear from you original post. If one
of the 2 houses was a "guest house" or "Mother-in-Law" unit
-- it's not impossible the entire property could be
considered your "main home." However, it's certainly
questionable enough that you should seek professional
guidance.

Also, as others have pointed out, this is a good time to get
an individual recommendation, which can take into
consideration the _exact_ details of your situation --
before you take any actions which might be incorrect.

Bill

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Thanks, that's what I thought. If we sell it all together
(land and houses) will it still be subject to capital gains?
We've already purchased the new 84 acres, will that offset
the sale of all the current property?

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"Bill" <an_ordinary_guy_158[at]hotmail.com> wrote:
- quote -

and you can defer taxes on the non-home parcels by properly
doing a 1031 "exchange", rather than a "sale and purchase".
Start the research and planning NOW.

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If we don't divide it, would it still be taxed separately,
or would it then all be considered the principal residence?

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<vicki.wells[at]modot.mo.gov> wrote

- quote -

I'm unclear how the second home on the property qualifies as
a residence that any gain would be exempt from tax. Maybe
if there were a clearer understanding of the facts and
circumstances, ownership, and what or who uses the other
house, then a more firm answer would be provided.

In general, if you used the acreage as your yard (no farming
or other business or income producing activity) then the
land sale would qualify for the gain exclusion if sold
within two years before or after the house sale. The land of
course, must be adjacent to the property the qualifying
residence is on. The sale of both parcels is treated as one
for the purposes of the $250k / $500k gain exclusion.

- quote -

Again, I'm not sure how the other house would qualify as
your principal residence. A little more information might
help in understanding and then open up the possibilities.

--
Paul Thomas, CPA
paulthomascpapc[at]bellsouth.net

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<vicki.wells[at]modot.mo.gov> wrote

- quote -

90 acres of land with two houses. One house is your principal
residence. What is the other house? How long have you owned
this arrangement and how has this 90 acres of land been used?
These are all important questions and there probably will be
more?

- quote -

You should be discussing whether of not the two houseless
plots qualify for a 1031 exchange with a local tax pro.

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vicki.wells[at]modot.mo.gov posted:

- quote -

They would be separate items, with capital gains taxes
assessed at your appropriate rate.

You should seek a professional appraisal on the relative
cost values of the parcels, so you can properly allocate
your cost basis. Any gain on your main home, as you
realize, will be exempt up to $500,000, as your "we"
suggests you would be filing MFJ ($250,000 for single).

Bill

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We own 90 acres of land with two homes on it. We are
considering selling it in 2 or 3 tracts of land, only one of
which would contain the homes. We are purchasing another
tract of 84 acres, which will replace it. How would the
capital gains be handled on the homeless tracts. Would they
still be considered part of our principal residence and be
exempt, or as separate, income property?

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