California Tax Brackets
September 6th, 2010
Question: Will I have to pay capital gains on a house I have owned since 1975 in California if I sell it?
This house has never had a loan on it. I have not lived there for at least the last 5 years. I have rented it out for the last five years. I would not call this my primary residence (at least not for the last 5 years). Will I have to pay capital gains if I sell it and if I do, what would the rate be assuming I’m in the highest tax bracket possible.
Answer: This is a rental property so, yes you will pay cap gains tax on the profit form the sale. Your profit will be the sales price, less cost to sell, less basis (purchase price) plus any depreciation you have taken while a rental property. There are a number of rates you will be subject to. The recapture of depreciation (Sec 1250) will be at 25% but the general rate is 15%. Consult a tax professional for further details.
State releases tax bracket information
Sacramento. The Franchise Tax Board has released the 2010 state tax brackets. Brackets are “indexed” each year by adjusting them to reflect changes in the California Consumer Price Index.
Check Out Cenk’s “Shared Sacrifice” Tax Plan
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