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Death & Taxes We have Information to Help You with Either Got a Question for a CPA Mom? Need Some Help? List of Tax & Accounting Services we Offer IRS wants you to retire Financially Free! We will answer your questions and give you options about how to become Financially Free when you retire Tax answers/options when you sell your Home. We will answer your questions about the tax free home sales and give you options on tax free exchanges So, You got a letter from IRS? We can help. Letters from IRS are scary. We will answer your questions at no charge. S-Corp, LLC, C-Corp, Partnership - Your Choice? Selecting the correct Business Entity is confusing. We will give you the tax options of each Business Entity. How not to pay taxes when you sell income property. We will explain how to do a tax free exchange & not pay taxes when you sell your income property. To pay for Services - Please click on Paypal Logo below Pay with any of the Credit Cards Listed Below OR If you have a Tax Refund - our fees can be withheld from the Refund   Tax Free Gain on the Sale of Your Home When a single taxpayer sells his or her principal residence that he or she has owned and used as a principal residence for at least two of the previous five years, the taxpayer may exclude up to $250,000 of the gain from gross income under Section 121. A married couple who meets the conditions may exclude up to $500,000 of gain. This means that the gain is never taxed. The taxpayer does not have to purchase a new home for the exclusion to apply. However, if the taxpayer has ever used the home or any part of it for business purposes, the taxpayer must pay taxes on the gain due to depreciation recapture. While many people are aware of this exclusion provision contained in Section 121 of the Internal Revenue Code, few people have thought about how to use it as a strategic wealth-building tool. The way to use it as a wealth building tool is to buy a home below market value, such as a foreclosure or probate property, sell the home a little over two years later, and then repeat the process. Another way to use this provision to its maximum is to act as one's general contractor and build a home. Individuals who act as their own general contractors can often build a home for 80 percent or less of its value. There are books available that explain how to do so. The advantage of buying a home below market value or building a home is that the taxpayer has a gain from the beginning. If the property appreciates more from the date of purchase or completion of construction, that is even better. The exclusion applies not only to the appreciation from the date of purchase or completion of construction, but it also applies to the gain from buying or building below value. While moving is a chore, by moving every two to three years, a taxpayer can realize substantial gains that are free from federal income tax and Social Security tax. "Keep moving" is not only a good slogan for physical fitness, it also can be good for fiscal fitness. If a taxpayer has some extra cash left over after selling a home and buying another one, the taxpayer can place money into a Roth IRA up to the maximum amount allowed if the taxpayer is eligible to do so. Doing so allows the taxpayer to generate even more tax-free income. For many taxpayers, tax deductions are becoming less valuable because of the alternative minimum tax (AMT). The gain on the sale of a principal residence that is excluded from gross income is not subject to the AMT. Taxpayers should use this generous tax provision to build wealth and minimize their tax obligations. The ability to exclude the gain on the sale of a principal residence is a great tax savings strategy.   Alan D. Campbell is a CPA in Arkansas and Florida and is self-employed primarily as an author of tax publications. He is the co-author of the book Tax Strategies for the Self-Employed. For more tax savings strategies, please see his Tax Savings Strategies blog http://taxsavingsstrategies.blogspot.com