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The Federal Tax Code allows married taxpayers to exclude from capital gains taxes up to $500,000 in profits from selling a home (singles can exclude $250,000). In order to qualify for this exemption, you must prove that that the home has been your principal residence for at least two out of the last five years. The establishment of the home as a principal residence depends on the facts of each homeowner's circumstance. Here are two cases to consider.

Homeowner A has lived at 25 Pine Drive for 12 years. Although he stays at his vacation cottage in another town for up to three months out of each year (sometimes more), 25 Pine Drive is his principal residence, where he lives most of the time. When he sells the home, Homeowner A (filing as a single individual) can keep up to $250,000 in tax-free profit.

Homeowner B buys 108 Maple Street, intending to live there. He rents it out while waiting to sell his current home, where he has lived for six years. His principal residence sells at the end of two years. Homeowner B moves into his new house, lives there for three months, and then decides to travel. After a six-month trip, he regrets buying 108 Maple Street and sells it. Even though he has owned the house on Maple Street for over two years, it won't qualify as "owner-occupied", because he only lived in it for a few months. Thus Homeowner B is not eligible to claim the tax exemption when he sells the house on Maple Street.

Consult your tax advisor for advice about your particular circumstance.

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John Beshk, Designated Broker

The Beshk Group, Inc.
1409 W. Crystal Spring Dr.
Gilbert, AZ 85233

Chandler Branch
908 W. Chandler Blvd., Suite 2, Bldg D.
Chandler, AZ 85225

Mesa Branch
1355 N. Greenfield Rd.
Mesa, AZ 85205

Office: 480-214-5347
Direct: 602-309-8888
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Email: John@TheBeshkGroup.com

John Beshk has been assisting Arizona home buyers and sellers with their real estate needs since 1992 and has helped hundreds of individuals and families realize their dream of home ownership. Every buyer and seller has different wants and needs, which makes finding an experienced professional like John and The Beshk Group, Inc. a necessity. John and his team of professionals can provide you with the individualized attention and service you deserve.

John is certified by the Arizona Department of Real Estate and Maricopa Community Colleges to provide pre-licensing, appraisal and continuing education instruction for real estate agents and college students. All of his courses are open to the public and available at Mesa Community College.

John earned his Bachelor of Science in Finance from DePaul University and Master of Business Administration from the University of Phoenix. John has resided in the East Valley since 1986 and currently lives in Gilbert with his wife, Mickie.

John is the Designated Broker for The Beshk Group, Inc. a family owned and operated real estate firm that prides itself on creating and maintaining sound relationships with its past, present and future clients.

You can contact John by telephone, email, request information through his website or by appointment at his Gilbert, Chandler or Mesa offices.

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