Quote:
Originally Posted by MATCHBX
You pay capital gains at the end of the tax year on anything higher than your regular income if I remember correctly. My mother had to go out and buy a new car in 2001 with what was left over from when she refinanced her home. If she hadn't, she would've been hit with capital gains on what was left.
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That is wrong... What is considered regular income? If I get a new higher paying job, do I have to pay capital gains tax? No. The statement about needing to buy a car to ofset capital gains tax is completely wrong also. If you refinance a home, you don't have to pay any taxes. You aren't making any more money. Capital gains tax is used for investments greater than a year. You would only have to pay them on a home if you sold a house that wasn't your primary residence for a profit, if you made money on a home you were living in between 1 and 2 years, or if you made more than 250k (for a single person) or 500k (married couple) on a home you lived in 2 years or greater. Currently, the capital gains rates are much lower than ordinary income rates regardless of what income bracket you are in
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