Capital Gains taxes can become an issue for those people selling their non-primary residence. If you are selling an investment property you may be responsible for capital gains if you are not going to use the proceeds to purchase a primary residence, etc.
Generally speaking, sellers who are selling a residence, other than their primary residence, will want to consult with their accountant or financial professional in order to determine if they are responsible to pay Capital Gains or if there is a way for them to structure the deal and use the funds to eliminate any need to pay Capital Gains.
For sellers who may potentially have to pay Capital Gains taxes, it is important to factor this into your planning. The last thing any seller wants is to be surprised at the closing, especially if they were planning on using the proceeds for the sale for another purpose.
Some real estate attorneys will be able to advise you if they think there will be a Capital Gains issue on a transaction, however, it is always a wise idea to get professional advice on the topic and that means consulting with an accountant that understands Capital Gains and how to determine whether or not anything is owed and how to reduce or eliminate the tax payment.
The old adage that the only things guaranteed in life are death and taxes certainly includes real estate transactions and that is why it is important to factor everything into the transaction which includes Capital Gains.
