Health & Fitness
'Cause I'm the taxman…and This Week’s Closed Sales
Often when I first meet with a home owner to talk about selling their property one of their concerns is what they will need to pay out at the closing. This is of course a most valid consideration since it will determine the amount of money they will actually “net” or walk away with from the sale, setting the stage for their next home. Closing a sale will include certain costs associated with the settlement of the mortgage, utilities, local taxes, attorney fees and the real estate commission. All of these will come off the bottom line to determine the actual amount the seller receives. And then there are TAXES.
The inescapable taxes that must be paid can come from several sources. The good news is that in most cases there are exemptions and dollar limits that can offset the amount paid or require no payment at all. A professional Realtor can give you a very basic understanding, but only your closing Attorney, Title Company or an Accountant can confirm what you may actually be required to pay.
Here are the most common taxes to look out for:
The State of New Jersey Realty Transfer Fee (RTF) this tax has been in place since 1968 to defray the state’s cost for real estate transactions. The monies collected are shared between the state and county. The Sellers pay the fee, based on their property’s closed sales price. A deed cannot be transferred to the buyer without this being satisfied in the State of NJ. It is a part of the closing Settlement statement (HUD) and collected at the real estate closing by the attorney, or title company responsible for recording the deed at the county registry offices.
Find out what's happening in Howellwith free, real-time updates from Patch.
Some exceptions are sales less than $100, transactions made between husbands and wives or parents and children, senior citizens, blind or disabled persons, and low- and moderate- income housing. These exemptions must be applied for by filing an affidavit document. More information and a calculator can be found at:
http://www.realstorynj.com/sellers/realty-transfer-fee-calculator
Find out what's happening in Howellwith free, real-time updates from Patch.
The Exit Tax has a lot of confusion attached to it. Basically it applies only when you sell your New Jersey home and then move to another state. But before you get too excited if you are moving out of state, there are a few details that you should know. This tax is tied into your State Income Tax filing. If the house you sold was your principal residence, the first $250,000 (single) to $500,000 (married) you made on the sale will not be taxable anyway. And you will still file as a resident on the State Income tax for that year since at the time of the sale you were one, this same rule holds for a second home. It is only when a non-resident is selling a NJ property that the tax really kicks in, since obviously if you don’t live here you would not be filing taxes to begin with. It is a way to capture the tax from non-residents who owned and sold property right at the time of the sale. You should consult your accountant if you are receiving a profit from a sale above the maximum allowed however, to see how this will affect your state income tax for that year or if you have further questions or concerns.
The ObamaCare Tax, yes there’s a real estate connection buried in this very long document no one read. This tax will apply after January 2013.
This tax will not be imposed on all real estate transactions. However it may impose a 3.8% tax on some income from interest, dividends, rents (less expenses) and capital gains (less capital losses) including those from real estate sales. The tax will apply only on individuals with an adjusted gross income (AGI) above $200,000 and couples filing a joint return with more than $250,000 AGI and even that will depend on the other gains that are added into the total AGI to determine what is actually taxable. A little complex if you fall into this category so definitely speak to your accountant for the details.
Be informed! A professional, licensed and knowledgeable Realtor can make a big difference when you sell or buy a home. Take advantage of it!
Pat Linde-Neidermeyer, Veltri Realtors
Call me: 732-598-8348
Email me: PatatVeltri@Gmail.com
Now here are This Week’s Closed Sales for your area.
FARMINGDALE
20 Alex Dr $615,000
FREEHOLD
6 Cornwall Rd $357,900; 10 Coventry Dr $395,000
HOWELL
39 Piazza San Paola $120,000; 16 Tracey Ct $222,500
189 Sunset Ln $248,000
9 Coddington Ct $510,845
JACKSON
93 Whispering Oaks Way $87,000; 163 Jackson Mills Rd $125,571
1 Regent Sq $181,000; 15 Montana Dr $200,000
6 Georgian Blvd $206000; 59 Cooks Bridge Rd $245,000
36 Birch Dr $270,000
All closed sale prices listed are as submitted and recorded by the Monmouth Multiple Listing Service. Not responsible for typographical errors.
