Legal Question in Tax Law in California
Is Cash-Out from Home Refinace Taxable?
Hello,
I am about close on a home loan refinance which provides me with a 29K cash-out of equity from my home. Are these taxable proceeds? If so, are there any strategies to mitigate my tax liability? Thank you for your expertise.
2 Answers from Attorneys
Re: Is Cash-Out from Home Refinace Taxable?
Thank you for your inquiry.
The money you receive as cash out is a loan, and has to be paid back with interest. Because of that, it is not "income", and so is not taxable.
Yes, there are ways to minimize your tax liability and shield your income from taxes, but you've given too little information in your question to answer those questions.
I hope that this answers your question, but if you need more information, have other questions you need answered, or feel that you need legal representation, please feel free to email me directly at [email protected]. I�m happy to help in any way that I can.
Re: Is Cash-Out from Home Refinace Taxable?
No.
However, when you sell the property, you might have capital gains taxes between what you paid for the property and what you sell it for. There are exceptions
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