Q: I co-own a property in Massachusetts. The other owner is buying me out. Are there tax issues I should be aware of?
A: You will have a taxable gain based on the sales proceeds less your basis in the property. If the property was subject to depreciation, then you would have "recapture" income. This recapture income would be taxed as ordinary income and not as capital gain income. Any amount of gain in excess of recapture income would be capital gain. If the property was held for one year or more the capital gain would be long term capital gain.
A: This is a tax question and not a real estate question so you should consult with an accountant or tax attorney.
A: If the property is used as a personal residence you may be able to exclude part of the gain under Section 121.
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