Selling my house and renting an apartment until I find a new house?

hopeful: Selling my house and renting an apartment until I find a new house?
If I do this will I get hit with a large capital gain tax bill? I lost the option to buy two different houses because my house was not sold yet. I could put the leftover money into the bank and use it for a down payment on the next house. Is this a bad move? PLEASE HELP

Answers and Views:

Answer by acermill
As long as you have lived in your principal residence for at least two of the five preceding years, you will owe ZERO in capital gains. As a single owner, you are entitled to a profit of $ 250K before capital gains kicks in. If you’re married, that increases to $ 500K.

Not to worry. Even if you do not meet those requirements, there is still a proviso for you, if you purchase a replacement primary residence within a certain period of time.

Answer by geiniusbobiknow
No, exactly what I did, of course it may cost you something for storage and interst tax, but it’s well worth the security of not being on the hook for two mortgages.

Answer by jamsoftheweek
you will not be subject to capital gains tax if you have a homestead exemption on the house you are selling (which requires that you live in it for 2 of the last 5 years). you WILL have to pay income tax on any interest you earn on the money while it is in the bank – before you move into your new house – but that probably wont be a significant amount.

not a bad move at all. just make sure you dont sign a long-term lease if you plan to buy soon (maybe 6 months or month-to-month if you can).

=)