LIVE FREE - THE ART OF THE TWO-YEAR HOME FLIP


Chapter 7



REINVESTING THE PROFITS


The reason that you are keeping the property for
two years as opposed to selling it is to avoid paying
income tax on your gain when the property is sold.
United States tax law (as of 2010) allows for tax free
capital gains up to $250,000 for an individual and
$500,000 for married couples, from the sale of a per-
sonal residence once every two years.

That means that as long as you lived in the house
as your primary residence, you will not be taxed on
your profit if you close on the sale of the home at least
two years after you purchased it. You will now have
many options for how to reinvest your profits.



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