Sunset Beach and Beyond Realty

  • Home
  • Search Carolina Coast
    • Community News
    • Calabash
    • Carolina Shores
    • Holden Beach
    • Myrtle Beach
    • Ocean Isle Beach
    • Southport
    • Sunset Beach
  • Buyer
    • Buyers Articles
    • Homeownership
    • Testimonials
  • Sell Your Home
    • Sellers Articles
    • Listing Agents
  • Our Team
    • Designations
    • Area Lifestyles
  • Market Reports
  • Local News
    • Events
  • CONTACT
Home » What Does Principle Residence Mean?

What Does Principle Residence Mean?

October 3, 2018 by admin Leave a Comment

What Does Principle Residence Mean?

As a homeowner, there are certain tax breaks and deductions that you can claim, however, these are primarily on your principal residence. So what exactly does that mean and can you deduct anything on rental properties?

In order to qualify for certain tax benefits the home you live in, must be your legal and principal residence. There are interest and tax reductions for investment properties but they fall under different categories.

Here we’re just talking about your principal residence.

Of course, this seems pretty cut and dry; it’s the house in which you live primarily throughout the year but there are differences, certain expectations, and situations where this might be a little bit foggy. If you move out of the house and then rented for sometimes before moving back there are specific facts that are to be determined on a case-by-case basis. If you’ve lived in the home for a number of years without moving out is considered your principal home and residency. This will probably be the address on your driver’s license, voter registration and where you pay your local and/or state income taxes.

If you once lived in the home and now you rented out it’s going to depend on how many months during the year you’ve actually lived in the home in order to take the right tax breaks and benefits. The IRS states that “the mere fact that property is, or has been, rented is not determinative that such property is not used by the taxpayer as his principal residence. If the taxpayer purchases his new residents before he sells his old residents, the fact that he temporarily rents out the new residents during the period before he vacates the old residents may not, in light of all the facts and circumstances of the case, prevent the new residents from being considered as property used by the taxpayer as his principal residence.”

Stipulations also state that the taxpayer is not required to actually occupy the old residents on the date of sale. The IRS will look at particular facts and circumstances in order to make a proper determination. You, as the homeowner, must be able to demonstrate that you did not intend to abandon the house as a principal residence in order to take the tax break.

If you’re looking to keep your primary home as your principal residence you want to do one of several things;

  • Sell your home before renting it out.
  • Avoid any impressions that you are not abandoning your house as a principal residence.
  • If you purchase a new home before the other one sells, keep your old house as your principal residence until it does.

All of these factors will determine the circumstances around a particular case of whether or not the home is your principal residence.

For more information or answers to your questions about real estate, homeownership or buying in Sunset Beach contact my office today.

Find Your Permanent or Vacation Home Now

 

Filed Under: Homeownership Tagged With: home, homeownership, own home, principle ownership, principle residence

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

What our clients say

Ken and Linda Foltz

“Life will lead you to where you belong. Five years ago life led me to meeting Karen Baker at an...
Sunset Beach and Beyond Realty
2015-03-16T20:16:32+00:00
“Life will lead you to where you belong. Five years ago life led me to meeting Karen Baker at an Open House. Our relationship continues as Karen and her husband Frank have been outstanding not only in helping my husband and I find the right retirement relocation home, but we have watched their commitment in helping many others find their homes. She and Frank treat every client as if they are the only ones that exist. They provide thorough research of areas and homes of interest and present you with the options. They are not your typical hard sell, must-buy-now realtors. They are here to help you find your next home?. You won’t go wrong with the Bakers!
https://sunsetbeachandbeyond.com/testimonials/ken-and-linda-foltz/

Steve & Jean DeVito

“The Bakers treated us like family during our whirlwind weekend of looking at houses. Prior to our on-site visit to...
Sunset Beach and Beyond Realty
2015-03-16T20:17:46+00:00
“The Bakers treated us like family during our whirlwind weekend of looking at houses. Prior to our on-site visit to Sunset Beach they created a portal and populated it with properties that met our ever-evolving criteria. By time we arrived we had a good feel for what we could afford and what was available that met our criteria. The Bakers, especially Karen, were able to make sense of what we thought we were looking for and eventually matched us with a house that we ended up purchasing — Karen called it the “This is it” house and she was right. We are loving our 2nd home and appreciate how painless Karen and Frank made the process. All the paperwork was done seamlessly and quickly and the closing went off without a hitch. The Bakers do not believe in the hard sell — they gave us the knowledge we needed and the guidance we needed to make our dream a reality.”
https://sunsetbeachandbeyond.com/testimonials/steve-jean-devito/

Matt & Amy Carver

Amy and I have bought and sold four properties in the past twelve years. Both of you are the best...
Sunset Beach and Beyond Realty
2015-03-16T20:18:22+00:00
Amy and I have bought and sold four properties in the past twelve years. Both of you are the best realtors we have ever dealt with. Amy and I both felt we could trust you to look out for our interest. The level of service you provided was outstanding, from taking the trash out, helping the buyer with inspecting the irrigation system, dealing with our tenants, always being there if we needed to ask a question, providing constant updates on the market and always keeping us informed on the sale of our house. I think your next venture should be training other realtors, because both of you have mastered the art of providing excellent service. I will be sure to recommend the Frank and Karen team to anybody looking for a trust worthy, knowledgeable and top performing realtor. It was a pleasure working with both of you.”
https://sunsetbeachandbeyond.com/testimonials/matt-amy-carver/

Ernie & Carol G.

“Karen & Frank Baker are the best. They are very knowledgeable with the area & showed us many homes. When...
Sunset Beach and Beyond Realty
2015-03-16T20:18:50+00:00
“Karen & Frank Baker are the best. They are very knowledgeable with the area & showed us many homes. When we made up our minds which one we wanted, they got us the best deal on it. We were very satisfided with them. After the purchased was made & we moved in, they were still there to answer any questions or problems that we might of had. Like I said, they are the BEST.”
https://sunsetbeachandbeyond.com/testimonials/ernie-carol-g/

Dave & Rose

“Thanks again for all the time you spent with us, As overwhelming as it was, you two made it fun”
Sunset Beach and Beyond Realty
2015-03-16T20:19:23+00:00
“Thanks again for all the time you spent with us, As overwhelming as it was, you two made it fun”
https://sunsetbeachandbeyond.com/testimonials/dave-rose/
0
Sunset Beach and Beyond Realty

Search

Recent Posts

  • 8 Adventurous Things to do in Sunset Beach
  • Evaluating & Purchasing Rental Properties
  • Typical HOA Pool Rules
  • 5 Great Reasons to Live in Sunset Beach (and one con)
  • Ways To Make Moving While Expecting Easier On Moms-To-Be

Connect With Us

  • Facebook
  • LinkedIn
  • Twitter

Recent Posts

  • 8 Adventurous Things to do in Sunset Beach
  • Evaluating & Purchasing Rental Properties
  • Typical HOA Pool Rules
  • 5 Great Reasons to Live in Sunset Beach (and one con)
  • Ways To Make Moving While Expecting Easier On Moms-To-Be

Copyright © 2022 · AgentPress Pro Theme on Genesis Framework · WordPress · Log in