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I'm selling my house, the wife and I . this is the problem, I built my house in 1990 and lost all my material lists and bills from all the sub contractors. and I'm going to exit the state. I'm going to get hit with the exit tax, how can I prove what I paid 28 years ago?? I can prove the land 100k, but not the building of the house 200k and if I sell for 450k that gives me a profit of 150k. I'm worry over this.
and, just like the IRS, they allow the Principal Residence Exclusion (see page 5 of 9 at the link above):
Principal Residence Exclusion:
Whether you still reside in New Jersey or became a resident in another state, you may qualify
to exclude all or part of the gain from the sale of your New Jersey home, based on federal
guidelines (See IRS Publication 523). To qualify, you must have sold your principal
residence in New Jersey, and you must meet the criteria on the following tests:
Ownership Test: You owned the home for two or more years during the five-year
period ending on the sale date;
Use Test: You lived in the home as your principal residence for two or more years
during the five-year period ending on the sale date;
Additional Home Test: During the two-year period ending on the sale date, you didn’t exclude a gain from the sale of another home.
If you met all three requirements and your filing status is:
Married Filing Joint, you may exclude up to $500,000 of the gain;
you get to exclude up to $500K of any gain from your NJ taxes.
Now, they WILL take $9,000 from you at closing for the so-called "exit tax". They're just going to refund the whole $9K when you file your NJ income taxes.
Haha. I figured maybe some blue state figured out a way to tax people when they leave the state. I am surprised Illinois hasn't implemented this. They could pay off the huge pension debt if they tax all the people heading for the exits here.
Haha. I figured maybe some blue state figured out a way to tax people when they leave the state. I am surprised Illinois hasn't implemented this. They could pay off the huge pension debt if they tax all the people heading for the exits here.
Sheesh. New Jersey doesn't have an "exit tax". What they have is a tax withholding requirement which is intended to cover capital gains taxes which may be due on the sale of a residence. (I imagine that NJ found that too many people failed to pay their taxes without the withholding--just as many people would fail to pay their income taxes if there were not income tax withholding from paychecks.) Since the OP falls under the $500,000 exclusion, he apparently has little to worry about.
Sheesh. New Jersey doesn't have an "exit tax". What they have is a tax withholding requirement which is intended to cover capital gains taxes which may be due on the sale of a residence. (I imagine that NJ found that too many people failed to pay their taxes without the withholding--just as many people would fail to pay their income taxes if there were not income tax withholding from paychecks.) Since the OP falls under the $500,000 exclusion, he apparently has little to worry about.
I think you misread my post. I wasn't saying they had an exit tax.
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