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| Las Vegas Real Estate Appreciation – Why Capital Gains Are Possible | January 5, 2007, 10:00 am | visits: 37 | wordcount: 538
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By Joel Teo
Real estate is like riding a roller coaster and in recent years Las Vegas has been on the high of that ride. Las Vegas real estate appreciation has many owing money on their capital gains. Wondering why capital gains are possible? It's all in the roller coaster ride.
In recent years Las Vegas real estate appreciation has been experienced by many home owners who had purchased years earlier at a substantially lower price and today Las Vegas real estate appreciation has caused them to ride that roller coaster from the lowest point to the highest.
The problem was that because this changing pattern many home owners were seeing significant capital gains on their properties so in 2003 the IRS changed the rules changing the principle residence tax exemptions from $250,000 to $500,000.
Now you might think that the Las Vegas real estate appreciation wouldn't be that big a deal but actually it was because the qualifications for the exemption of the capital gains weren't always that easy to meet. Let's have a look at those qualifications.
You had to married to qualify for this new exemption so that left singles struggling with the Las Vegas real estate appreciation. However the house need only be in one person's name but they must be able to prove residency through their tax forms to avoid the capital gains of the Las Vegas real estate appreciation.
You have to have owned and lived in the home for two of the five years before you sell the house. The occupancy doesn't have to be continuous and it doesn't have to be your principle residence at sale time.
So if you lived in it yourself for one year then rented it for two years and then lived in it yourself for year five you could avoid the capital gains from the Las Vegas real estate appreciation as long as you only took advantage of this once in 2 years.
Thanks to changes to the IRS rules you no longer have to purchase a replacement home to avoid the capital gains caused by Las Vegas real estate appreciation.
There are however methods used to ensure it is your principal residence. Expect the government to want you to have worked, be registered to vote, and even have filed income tax in Las Vegas for you to be able to be exempt from capital gains as a result of Las Vegas real estate appreciation. If you don't meet the qualifications you might qualify for a partial exemption.
If you are single, go over the IRS assigned value, or own vacation property in the area you will definitely find yourself in a capital gains situation as a result of the Las Vegas real estate appreciation.
Recent years have seen Las Vegas real estate appreciation grow at astounding rates. Make sure you know what you can do to help reduce the capital gains you might be liable for.
Copyright © 2007 Joel Teo. All rights reserved. (You may publish this article in its entirety with the following author's information with live links only.)
About the Author: Joel Teo writes on various financial topics including
Investment Properties in Las Vegas. Learn more about
Investment Properties in Las Vegas in our Real
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