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is the law the U.S. Congress passed for you! Discover the surprisingly
little known ins and outs of earning a huge freebie from Uncle Sam
every time you owner-build. The rules have changed - know the rules.
Six pages, revised and updated with new reader tips, web links and comments.
- Special benefits for owner-builders
- What size house you must build
- Financial effect of marriage
- What if you rent out your house before sale?
- How to use the law to build for a living
- How to own your own home free and clear faster
Excerpt from Report:
Taxpayer Relief Act of 1997 was signed by Bill Clinton on August
5, 1997, and provides unheard of advantages to homeowners. In the old
days, you had to wait until retirement to sell your house and get a tax
break on your gains. That break had a limit of $125,000. The new law
lets you sell your house at any time and keep the profits tax-free, up
to a limit of $500,000 fora married couple.
The new law
provides real advantages to an 'owner-builder', someone who saves
money building a house by acting as their own general contractor. If
you elect to contract your own home you will find the law holds ten
special benefits for you:
1. You can take the tax break every two years.
little provision in the law may not seem significant at first, but all
by itself it can make owner-building a lucrative pastime. If your house
is built the conventional way ? with a general contractor - you can?t
make enough money in two years to get a benefit.
will not appreciate fast enough to make a profit after two years. The
'in and out costs' of Realtor commissions and loan origination fees
will eat up any gain appreciation gives you."...
Sample Reader Tip Excerpts:
I am in the process of
trying to build one or
two houses for sale
every year. I am trying
to find out how to go
about it in terms of if
it’s in my best interest
to just pay taxes on
the capital gains or to
have all this under a LLC
I am working on my
contractor’s and building
licenses. Any advice
I get from you guys is
by Joseph in Stafford,
If you are building for
profit as a business and
not living in the home
for two years you will
have to pay capital
gains taxes on the sale.
I believe the current
federal rate is 15%. A
corporation and an LLC
are two different types
of business structures.
You may want to talk
to an accountant or
an attorney about
the advantages of
each kind of business
structure. You will need
a relationship with
an accountant as you
launch your business