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Selling my house within 2 years, I took a job 850 miles away. What are my tax options?

I took a job about 850 miles away from the house I bought and I only got to live in the house for 12 months. I tried to sell with no bites so I leased it to some friends for the past 3 months who now made an offer out of the blue. I bought the house in Nov. 07 and moved out of state in Dec. 08. I hear some nasty things about taxes within a 2 year period. I heard we should reinvest it however, the job that i currently have is only going to be around for 2-3 years. I thought about buying a motorhome/rv and making that my primary residence until I get settled but, will that count as re-investing? Any advice????? Thanks Yes there is a difference. We bought it for 130k and completely remolded it about 40k into it. I got an offer for 180k, I don't mind paying on 10k but, I'm hearing that since the 40k was more than 90 days ago that we can't claim that and we have to pay taxes on the entire 50k or whats left after closing. That seems highly unfair seeing that I did not expect to take a job somewhere's else. Now in order to avoid getting cleaned out, I need to buy a rental?? While I am renting myself??? That seems messed up to me.

Public Comments

1. Because this can be a complex issue, I suggest you use the advise of a professional tax attorney. No sense second guessing and ending up owning a bundle of taxes in the end.
2. in order to not pay taxes on your primary home when you sell it, you need to have lived in the home for 2 of the past 5 years. Since you didn't do this, you would pay taxes on any profit. HOwever, is there any profits. I'm betting there isn't any.
3. You pay capital gains taxes on the difference between when you purchased it and when you sold it. Since you don't live there, it's an investment property, and in order to avoid the tax you would have to re-invest in ANOTHER rental property. You cannot "cross" by selling an investment for a primary, or a primary to an investment house.