Selling house in Canada after becoming US residents

[pilot787 23]

Hello! Was wondering if smb can suggest a good tax advisor in the US. We live in Canada and planning to land in US as new rsidents in October. I'm not sure if we will be able to sell our house by then. I know we can be exempt for 500,000 revenue on selling it, but it might be a bit more. And don't feel like paying 15% on that. Does anyone know if we can add the renovations expenses towards the initial cost of the house. 

 

Thyanks for any advice on that! 

[Mike E 11,739]

3 minutes ago, pilot787 said:

I know we can be exempt for 500,000 revenue on selling it

In the U.S. the IRS exempts the first $500,000 in capital gain for a couple filing jointly if you have lived in the house for 2 or more years in the past 5 years.

 

So unless you acquired the house for zero dollars, the revenue from sale does bot matter.
 

What matters is net sales proceeds minus purchase price - purchase some purchase closing costs - cost of home improvements - cost of repairs needed to sell house.

[Lemonslice 4,808]

You want to check with the CRA/Canadian fiscalist also.  It's been a while, but, if I remember correctly, non residents lose some exemption. 

 

Colleague of mine has used this firm in when they moved:

https://www.serbinski.com/

 

 

[pilot787 23]

48 minutes ago, Mike E said:

In the U.S. the IRS exempts the first $500,000 in capital gain for a couple filing jointly if you have lived in the house for 2 or more years in the past 5 years.

 

So unless you acquired the house for zero dollars, the revenue from sale does bot matter.
 

What matters is net sales proceeds minus purchase price - purchase some purchase closing costs - cost of home improvements - cost of repairs needed to sell house.

Thanks for your reply! Yes, we owned it fir more than 5 years, and lived there together for more than 2 years. So, let's say, we sold it for 1 mln $, but bought it for 300,000 = 700,000 gain. IRS exempts 500,000 for us = 200,000 , but we did home improvements, rennovations, +pay to the real estate agent, which let's say equals to 200,000$. So, technically, we won't be paying any taxes on the sale of the house? 

On a side not, do you know by any chance. I had a SSN in the US in 2010, I worked thre for 2 months. Does it mean, I have some kind of Credit History in the Us, or I'll have to start from the beginning with no credit history. 

 

Really appreciate your help!

[pilot787 23]

22 minutes ago, Lemonslice said:

You want to check with the CRA/Canadian fiscalist also.  It's been a while, but, if I remember correctly, non residents lose some exemption. 

 

Colleague of mine has used this firm in when they moved:

https://www.serbinski.com/

 

 

Yeah, I kind of read on it. But I think we should be good for Canada, because it is our primary residence. But thanks so much for suggestion, will look into it! Debating if we should wait to sell the house before moving or wait=)

I'll def look into them! 

[Mike E 11,739]

9 minutes ago, pilot787 said:

So, technically, we won't be paying any taxes on the sale of the house? 

Correct. 

[Ontarkie 14,193]

On 6/5/2023 at 9:21 AM, pilot787 said:

Yeah, I kind of read on it. But I think we should be good for Canada, because it is our primary residence. But thanks so much for suggestion, will look into it! Debating if we should wait to sell the house before moving or wait=)

I'll def look into them! 

It won't be your primary residence when you sell it after you move. This is where many Canadians have complained about with selling after they immigrated. Try your best to get it sold before the move. 

[pilot787 23]

On 6/12/2023 at 8:53 PM, Ontarkie said:

It won't be your primary residence when you sell it after you move. This is where many Canadians have complained about with selling after they immigrated. Try your best to get it sold before the move. 

I read the CRA instructions as to what is considered your primary residence. But based on that, as long it was our primary residence for so many years, and it is our only house, it looked like we didn't have to pay anything in Canada.. But I'll definitely try to look into it. It's just so hard to sell a house now. Hopefully, we will manage to sell it early. 

[Lemonslice 4,808]

Quick consultation with a fiscalist will be worth it.