Cash Home Buyers in Chattanooga Reveal the Tax Costs of Selling Your Home

A common question among those looking to sell their homes is, "How much tax do you pay when selling a house?" Experts at Chattanooga Property Solutions offer answers to this nuanced question below.

Sellers Incur State and Federal Capital Gains Taxes

Individuals who make a profit after selling real estate are subject to a capital gains tax. Over 100,000 sellers in Tennessee incur these taxes each year as the state's home sale trends continue to take an upward trajectory. When someone searches for ways to "sell my house fast in Chattanooga," they should be mindful of the potential taxes they'll owe when closing the sale.

The amount one owes in capital gains tax depends on the difference in sale price compared to when they first purchased the house. Any type of profit on a home sale should be reported to tax officials, though the official tax rate is subject to change.

What Are the Tax Exemptions for a Chattanooga Property Sale?

Anyone wondering, "How much tax do you pay when selling a house?" needs to learn about tax exemptions that exist. If someone meets this criteria, they might not have to pay a dime in federal or state taxes. Tennessee couples can enjoy up to $500,000 in tax deductions while unmarried individuals can receive $250,000 in deductions based on the following:

Whether they lived in the home for at least two of the last five years before the sale
If they haven't already claimed the tax exemption on another property in the last two years
If their profits fall below the IRS threshold

For example, if an individual filer makes a profit of $300,000 when their threshold is $250,000, they'll have to pay capital gains tax on $50,000.

Contact Chattanooga Property Solutions for a Convenient Home Sale

The team at Chattanooga Property Solutions can answer a wide range of seller questions, including, "How much tax do you pay when selling a house?" and, "What affects property sale timelines?" As cash home buyers, they make fair offers for homes in any condition and allow sellers to close within just a few days. No matter what reason prompts someone to sell their home, Chattanooga Property Solutions is ready to help.

Call their team at (423) 454-3070 to learn more. Request more information today.