How The IRS Can Be A Minneapolis Duplex Seller’s Best Friend

I’ve recently met with several prospective duplex home sellers who, facing a slower real estate market, were surprised to find the IRS could save the day.

In each case, the property owners had owner-occupied their duplexes at some point in the last five years, ultimately moving out and renting their old unit.

Of course, one of the benefits of owner occupying a duplex is the ability to avoid any capital gains tax on the unit that wasn’t leased; provided the owner lived in the premises two of the last five years.

While I encouraged all of these sellers to consult a qualified tax professional, most reported back by selling now and avoiding capital tax on their half of the duplex, they would be saving thousands of dollars.

This was a bit of a silver lining for them, as it was as if they’d found some of the money they thought they’d lost; in the sofa.