Safety and your fireplace
While you are enjoying the warmth and pleasures of your cozy hearth
this season, the United States Fire Administration reminds you
of the following safety tips:
-
Have your chimney or wood stove inspected and cleaned each year.
-
Clear the area around the hearth of any debris, paper or flammable
materials.
-
Always use a metal mesh screen when a fire is burning, and keep
the glass doors open to allow proper draft and cleaner burning.
-
Start your fire with a small flame to heat the chimney and help
prevent the build-up of tar and pitch. Build small fires that
burn completely and produce less smoke.
-
Never burn wrapping paper as it can contain chemicals that emit
hazardous fumes or cause dangerous flare-ups.
-
Never use flammable liquids to start a fire.
-
Pressure-treated wood should not be burned in stoves or fireplaces
as it contains toxic chemicals that can make you sick.
-
Do not burn newspapers or other trash in a fireplace as these
materials burn too hot and can ignite a chimney fire.
-
Most importantly, NEVER LEAVE A FIRE UNATTENDED.
What happens if my property stays on the market too
long?
The usual answer is
that a lower sales price will be needed. Your Realtor will
be able to suggest a timeframe in which the home should sell
and when the price needs to be reduced. Homes that have been
on the market too long should be looked at with a critical
eye. There may be inspection problems or reasons other than
market conditions for the home not selling. It also may have
just been overpriced to begin with. If you're a seller, you
can avoid this situation by pricing your property
appropriately at the beginning. Research your home's value,
get a comparative market analysis, and factor in your home's
inherent qualities, location, condition, and local
competition.
When should I put my home on the
market?
Many sellers decide
to put their homes on the market in the spring between March
and May, and these are typically the strongest months for
the real estate market. Green lawns and gardens enhance the
appeal of the home in Spring. People also often buy or sell
during this time to be able to move in June, when school is
out.
As a seller, you
will give yourself a distinct advantage by placing your
property on the market earlier, before you face competition
from other sellers. Homes sell in all seasons of the year,
and if it is priced right and in "show" condition, your home
will sell at any time of the year.
Do I pay a Federal Income Tax capital gains tax on the sale of my home?
For homeowners,
selling your house is acknowledged as the best tax break
available. Mortgage interest and property tax deductions can
really help at tax time. Homeowners may also be surprised by
the break in capital gains tax when you sell your home.
The old way,
before May 7, 1997, to avoid paying taxes on the profit from
the sale of your home was to use the money to buy another,
more expensive house within two years. To add to the
confusion, sellers age 55 or older could take a
once-in-a-lifetime tax exemption of up to $125,000 in
profits. And the old way had tax paperwork to fill out and
rules to follow.
Now, when you
sell your primary residence, you can have a profit up to
$250,000 if you are a single owner, twice that if you are
married, and you won't owe any capital gains taxes. The law
change applies to all sales since the Taxpayer Relief Act
took effect on May 7, 1997 and the change serves to make it
easier to sell your home. Plus, with the new rules, you
don't have to buy another home with your sale proceeds, and
even better there is no limit on the number of times you can
use the home sale exemption. In most cases you can make
tax-free profits of $250,000 (or $500,000 if you are married
filing a joint return) every time you sell a home.
Taxes can never
be quite that simple, though, and some requirements and
special circumstances do apply. First, the property you are
selling must be your principal residence. That means you
live in it for two out of the five years before the sale.
This tax break does not apply to a house or other property
that you have solely for investment purposes or a second
home that does not qualify as your primary residence. Normal
capital gains rules apply in those cases. However, you can
turn a rental house into your primary residence by living in
it for ANY two of the 5 years before the sale. You could
live in the house for a year, rent it for two, move back in
for another year and rent it again the year before you sell.
Have a second
home? After you sell your primary residence, you could move
into your vacation home and establish it as your primary
home for a couple of years and then sell that home. This way
both homes can be sold without having any taxable gains.
Note, however,
that if the property you convert to your principal residence
is one that you obtained via a property swap or like-kind
exchange, you must live in the converted property for five
years instead of just two years to take advantage of the
home sale capital gains exclusion.
While there is
no limit on the number of homes you can sell using this
capital gains break, each sale must be at least two years
apart. Technically you can sell your residence at a profit
of up to $250,000 (or $500,000) and buy your next residence.
Two years later you can do the same thing, and you can do
this every two years for as many times as you like.
Special
circumstances to note for married couples
Read carefully,
there are some twists and turns here. Either spouse can meet
the ownership test. If you've lived in the home for the last
two years, but just got married a few months ago and added
your new husband to the title, as joint filers you have no
problem meeting the ownership test even though your husband
wasn't an official "owner" for that long. But, both husband
and wife must also pass the use test. Each must have lived
in the residence for two years, including time your
now-husband (or wife) shared the home before and since the
marriage. But you are out of luck if your spouse didn't move
in until the wedding day.
The previous
home sale history of your new spouse can also make a
difference. The two-year eligibility rule applies to both
spouses, so if either sold a home and used the exclusion
within two years of the sale of any jointly owned property,
the couple can't claim the exclusion for this sale. You'll
have to wait two years after that property's sale date
before you can sell the newly shared property tax-free.
Special
circumstances for military personnel
Because of redeployments, soldiers often find it hard to
meet the residence rule. A law change in 2003 now exempts
military personnel from the two-year use requirement for up
to 10 years, letting them qualify for the full exclusion
whenever they must move to fulfill service commitments.
Special circumstances for those who sold their residence
prior to the 1997 law change and rolled the profit into the
home now being sold
The previous
exclusion amount must be accounted for by decreasing the
basis by the amount of gain you postponed years ago. Compare
this adjusted basis with the amount you get from the sale,
less your commissions and other expenses to get the amount
of gain on the sale.
Prorated gain
You're still eligible for a prorated tax-free gain if you
sell for special conditions such as a change in health,
employment, or unforeseen circumstances. In these cases
calculate the number of months you lived in the home divided
by 24 (the number of months in the two-year occupancy
requirement). For example 12 months would be 0.50. Multiply
the full exclusion of $250,000 or $500,000 by 0.50 to find
the eligible sale gain exclusion ($125,000 or $250,000 at
0.50).
A
note about keeping records
Even though
keeping records
wasn't supposed to be necessary with the new law, special
circumstances and the necessity to provide a basis make it
safer to keep those records. Your basis is what you paid for
the residence and all capital improvements you've made.
Don't forget to subtract commissions and other expenses from
the amount you get from the sale.
With any
tax-related issue you should always check with your
accountant or tax advisor before making any decisions or
plans which could affect your taxes.
Home maintenance
know-how:
Homeowners' guide to lead
removal, roof repairs, termite eradication, and other
problems.
www.nationalinspection.net/inspector/residential.html
Gardening:
Short on-line videos about
garden design, perennials, lawn care, water needs, and more.
plantfacts.osu.edu
Mosquito bite
protection:
Mosquitoes can carry West Nile
disease and other serious illnesses. Get information on how
to mosquito-proof yourself at
www.cdc.gov/ncidod/dvbid/westnile
Find a better cell-phone calling plan to suit your needs:
Compare your recent cell-phone
bills, and look closely at your calling habits. Then go to
www.myrateplan.com,
www.saveonphone.com,
or www.letstalk.com to
to see if there is a better rate for your usage level.
Here's a source for
decorative
hardware for your next home fix-up or remodeling project
If you are
THINKING OF SELLING YOUR HOME
email or call 915-381-6850 to find out
what the current market value of your home is
and what I can do to successfully market and sell your home
–quickly and for top dollar.
(This market analysis and consultation is
Free -- no charge and no obligation)
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