Legal Question in Real Estate Law in California

Hi there! I bought a home in Los Angeles, less than two years ago. Now it's too far away from my work, and I want to sell it and move. I heard that I would have to pay extra taxes if I sell before two years is up - is that true? I bought my home for $450,000 , and i have renovated and done some constructions and i think it will worth about $520,000 now.

Thank you.


Asked on 2/04/16, 4:45 pm

1 Answer from Attorneys

It depends on whether you took the capital gains tax exemption for the sale of a previous property in the year when you bought the current home. You can only take the capital gains personal residence exemption every two years or longer apart. So if you took the exemption less than two years ago you will pay capital gains tax on the difference between what you paid for it plus the cost capital improvements (but not maintenance or repairs), and what you sell it for, unless you wait two years or more from last claiming the exemption before you sell. If you wait for the exemption to renew, you only pay tax on any gains over $250k if you are single or $500k if married filing jointly.

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Answered on 2/04/16, 7:25 pm


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