The capital gains exemption is this: Imagine you buy a house and imagine 10 years later that house goes up in value and you want to sell that house.

Well, you're going to make money on the sale of that house, right? Because you bought it for X and you're selling it for Y. Well, what happens to the money when you get it? Well, the federal government always wants a piece, don't they? They're going to tax you, except they won't tax you on the first $250,000 of the money that you made on your home sale if you're single or the first $500,000 of the money you made on your house if you're married, filing jointly.

And the beauty of this is that it's just all your money. So, you could buy your house for $500,000 sell it for a million, and pocket the entire $500,000 if you're married. It's the first 250 if you're single.

So, this is going to be a short video because that's pretty much all it is. 250 for single, 500 for married. That's money you get to keep in your pocket.

Why does the government do this? Well, we imagine it's because they want to keep spurring home buying and selling because it's kind of one of the lifeblood of the entire United States economy and they want to keep people moving rather than saying, “Oh, I'm not going to sell my house because then I just have to pay taxes on my gains.” If you don't have to pay taxes up to $500,000, well, that's a good incentive to sell your house, don't you think?

For more information about how you can save money when you buy and sell? Just message us.