Residential real estate market information for Metro Detroit's Northern Suburbs brought to you by Realtors Maureen Francis and Dmitry Koublitsky of SKBK Sotheby's International Realty. Monthly market statistics for home owners in Oakland County. MLS listings available on our web site:

Thursday, April 21, 2005

Using the Principal Residence Sale Tax Exemption

Thursday, April 21, 2005By Robert J. BrussInman News Internal Revenue Code 121, the principal-residence-sale tax exemption, can be used over and over again, without limit, but not more frequently than once every 24 months. Some savvy home buyers have even created a tax-free business by buying a fixer-upper house, living in it at least 24 months, meanwhile renovating it to increase its market value. If you do this over and over, you will soon become known as a tax-free "serial home seller!" A single person can qualify for up to $250,000 tax-free profits, but a married couple (or two qualified, unmarried co-owner residents) can qualify for up to $500,000 tax-exempt profits every 24 months. The big drawback, however, is living in the home while it is being renovated!

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