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As Profits Rise, Capital Gains Tax Hits More DC Home Sellers

  • May 6th 2024

by UrbanTurf Staff

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For years, UrbanTurf has reported on the hefty profits that DC-area home sellers have reaped. Now, the tax implications of those profits are coming into focus. 

A recent article in The Wall Street Journal noted that 8% of U.S. home purchases in 2023 brought profits over the $500,000 limit for couples to be exempt from capital-gains taxes, double the total from 2019. 

In DC, the percentage was significantly higher. Twenty-two percent of home sellers in the city saw windfalls in excess of $500,000 at the end of 2023. That percentage is not too surprising given the our recent coverage that found home sellers reaping six-figure profits in most city zip codes. 

For many, capital gains from selling a home aren’t taxed. The exception is one of the biggest in the tax code — for a single person, up to $250,000 in profit is exempt from obligations to Uncle Sam. If married and filing jointly, that threshold goes up to a comfortable $500,000 exempt from taxation. But as profits get bigger, that $500,000 threshold is regularly being exceeded. 

For UrbanTurf's primer on the taxes and profits of selling a home, click here. 

See other articles related to: capital gains tax, dc home seller profits

This article originally published at https://dc.urbanturf.com/articles/blog/as_profits_rise_capital_gains_tax_hits_more_dc_home_sellers/22273.

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