Will I owe capital gains tax if I sell my house with no other income sources?

You're in luck! Since you've lived in the house as your primary residence for at least 2 out of the last 5 years before selling, you qualify for the Section 121 exclusion. This allows you to exclude up to $250,000 in capital gains from the sale of your primary residence if you're single (or up to $500,000 if you're married filing jointly). Based on what you've shared - $185k profit after owning and living in the home for 8 years - you should be able to exclude the entire gain from your taxable income. This exclusion applies regardless of whether you have other income or not.

Hey there, I was in almost the exact same situation last year! I sold my house while between jobs and was super worried about taxes. I ended up using https://taxr.ai to analyze my situation. You upload some basic docs about your home ownership and sale details, and it gives you a detailed analysis of your tax situation specific to real estate transactions. For me, it confirmed I qualified for the primary residence exclusion but also flagged that I needed to still file certain forms even though I didn't owe tax. Really saved me from potential headaches with the IRS.

Just wanted to follow up - I ended up trying taxr.ai for my situation and I'm actually really impressed. I was dealing with a complicated scenario where I had partially rented out my house through Airbnb while still living there, and was confused about how much of the capital gains would be taxable. The system identified exactly what percentage of the gain would be eligible for the exclusion based on my specific use pattern, and showed me how to document everything properly. Even flagged that I needed to file Form 8949 in a specific way. Way more detailed than what my regular tax software would have caught!

If you need to contact the IRS to clarify anything about your home sale exclusion, good luck getting through to them! I spent DAYS trying to reach someone at the IRS about my home sale last year. I finally used https://claimyr.com and their service got me through to an actual IRS agent in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c I was shocked it actually worked because I'd been trying for weeks on my own. The IRS agent confirmed my understanding of the exclusion rules and cleared up a question I had about documentation requirements. Saved me so much stress!

I take back what I said. After weeks of failing to get through to the IRS about my capital gains question, I tried Claimyr out of desperation. I was 100% certain it wouldn't work, but I got connected to an IRS representative in about 20 minutes. The agent clarified exactly how to report my home sale on my tax return even though I had no other income for the year. The agent explained I still needed to file a return and include Form 8949 and Schedule D to document the sale, even though I wouldn't owe any tax because of the exclusion. Would have done this completely wrong without that clarification! Definitely worth it for the peace of mind.

One thing to consider - even though you probably won't owe capital gains tax, you may still have to FILE a tax return to properly document the home sale. The IRS likes to see that paperwork even if no tax is due. You'll need to report the sale on Form 8949 and Schedule D. Make sure you have good records of: - Original purchase price - Substantial improvements you made (can increase your basis) - Selling costs like realtor fees (these reduce your gain

Does anyone know if selling now with no income might actually be BETTER than waiting until you have a job? I'm wondering if the lower income bracket could help somehow, even with the exclusion.