Legal Question in Tax Law in New Jersey

Selling your primary residence

When selling your first home (a two family House)does the law that said you dont have to pay taxes on selling your first home and primary residance apply to two family houses. 60% of the home I lived in, and 40% was rental. We lived in this home for 5 yrs. Do we have to pay taxes on selling this property?


Asked on 1/08/04, 4:13 pm

1 Answer from Attorneys
Walter LeVine Walter D. LeVine, Esq.

Re: Selling your primary residence

On a 2-family home, in which you resided for 2 of the past 5 years, the portion of the sales price allocated to your portion used as your primary residence(60%) is not taxable unless the gain exceeds $250,000 if you are single or $500,000 if you are married. Any gain on the second portion you probably rented or could have rented, will be taxed. If it was rented and you depreciated that portion, there may also be additional taxes due based upon depreciation recapture. I suggest using a professional tax preparer to assist you.

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Answered on 1/08/04, 10:47 pm


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