What can I do with my loss in housing?

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Submitted by djrobsd on October 9, 2008 - 2:38pm

I sold my house at a loss in January (previously posted in here about all that), with about $30,000 worth of expenses that I can write off. How does the whole capital loss thing work?

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Capital loses on a primary
Submitted by fat_lazy_union_... on October 9, 2008 - 2:51pm.

Capital loses on a primary home I believe are not deductible

I am afraid that you have to
Submitted by donaldduckmoore on October 10, 2008 - 12:51am.

I am afraid that you have to eat it.

You are young so learn from
Submitted by SD Transplant on October 10, 2008 - 7:38am.

You are young so learn from it. I've experienced the DOT COM bust when I was about your age, and it was a great lesson (I did not buy a place since I knew it was "the next bubble").....

fat_lazy_union_worker
Submitted by djrobsd on October 10, 2008 - 1:03pm.

fat_lazy_union_worker wrote:
Capital loses on a primary home I believe are not deductible

You are correct, I just researched the IRS Web site a bit more, and they are not deductible. Don't ask me why I thought they were, I guess I had some friends who tried to convince me otherwise, and now I know the real truth.

djrobsd
Submitted by fat_lazy_union_... on October 10, 2008 - 1:27pm.

djrobsd wrote:
fat_lazy_union_worker wrote:
Capital loses on a primary home I believe are not deductible

You are correct, I just researched the IRS Web site a bit more, and they are not deductible. Don't ask me why I thought they were, I guess I had some friends who tried to convince me otherwise, and now I know the real truth.

Actually, in hindsight, you could have probably turned it into a 1 month rental, and considered a rental property, but don't know if there would have been a time test.

I would consult an
Submitted by SD Realtor on October 10, 2008 - 2:48pm.

I would consult an accountant. Regarding the principal loss you are most likely out of luck. I don't know if you can carry that against any possible capital gains in the future of your life. Again, talk to an accountant.

Also if you are paying interest on loans associated with getting out of that home, you may indeed be able to deduct that interest. Again... talk to an accountant.