Delay closing to avoid capital gains tax?

[jimday1982]

Hello all-

I'm seeking some advice regarding the sale of my home and the avoidance of the dreaded capital gains tax. I purchased the house in August 2005 and I am under the impression that I have to wait a full two years to sell the house to avoid paying capital gains tax - is that correct?

If so, my plan was to begin marketing the house in June and if needed, delay the closing so it does not take place until August. Does this sound like the best approach? What would you recommend?

I cannot thank you enough for your help!

[TJ2007]

Yes, sounds much better to wait to close to avoid the tax for sure...though depending on your neighborhood market I would probably put it up for sale much earlier than that...

[jimday1982]

Oh really? I wouldn't have a problem with that, however, what would happen if someone made an offer right off the bat, say in April? Is it customary to delay a closing that long (4 months or longer)?

[TJ2007]

90 day closings are not that unusual. If you are really confident your home is going to sell that quickly I'll have to check out your neighborhood as the rest of the country seems to be moving much much slower:)

[jimday1982]

Yeah, that could definitely be the case but I'm just trying to plan around all possible scenarios.

Assuming I sell the house and delay the closing as long as I need, is it an unreasonable request to ask for another 30 days to prepare to move out? I would do that beforehand, but I'm leaving the state and if I went through all the preparations and something fell through at closing, I'd be up a creek without a paddle.

Thanks so much for your help.

[TJ2007]

You mean 30 days after the closing?

It's not that uncommon for the seller to leaseback the property for a short period of time. Plus it's nice for the buyer to know it's a done deal even if the don't need to move in yet...

[jimday1982]

Exactly. OK, a leaseback...that's exactly what I was after!

Thanks so much for your help!

[viavirginia]

Perfect response TJ. Good luck with the sale Jim...you know, it could be very benificial to use a Realtor to provide all the help you will need Jim!

[jimday1982]

Thanks guys, I really appreciate it.

I went to the bookstore today and bought a FSBO book to try and guage the difficulty of that route, but I also plan to intervew a couple realtors to see exactly what they could bring to the table and for what price.

I will most definitely let you know what happens!

Thanks again!

[Paso Dog]

When you list your home have the Realtor put in the listing that the closing date has to occur after your 2 year date. You will need to look at your closing papers so you know the exact date and I would close at least one day after.
Good Luck