If you’re getting a divorce in Florida and own a home, it’s critical to time the sale of your property appropriately to ensure you receive the highest amount possible. Doing it wrong can cost you $250,000.
Understanding how the capital gains tax break works
If you’re selling a home and want to qualify for a capital gains tax break, it must meet specific conditions, which include the following:
- Must be your principal residence for an aggregate of at least two of the last five years
- Must have owned the home for two of the last five years
- Must not have claimed a capital gains tax exemption on another property within the past two years
Stay married until you sell the property
When you decide to get a divorce and want to ensure you receive the highest capital gains tax break possible when selling your home, it’s best to stay married until the property sells. While doing so may require you to postpone your final divorce paperwork, it can help you receive more money after selling your property.
Knowing all of your options can be critical
Many factors can be involved if you and your spouse have decided to divorce and own a home. Knowing your options can ensure you both receive the maximum capital gains tax break. For example, if you both own the home and sell with only one spouse living on the property, addressing this issue in the divorce paperwork must be done to ensure that the spouse not living on the property qualifies for and receives the $250,000 exclusion.
If you and your spouse want to get a divorce and receive as much as possible for the home sale, understanding the process and rules is critical. You must plan and account for each scenario to safeguard you from making a costly mistake.