Hope Leitner, Realtor®, CRS

If when you sell your home, you realize a taxable gain even after the exclusion, you can reduce your gain with selling costs. Your gain is your home's selling price, minus deductible closing costs, minus your basis. Your basis is the original purchase price, plus capital improvements, minus any depreciation. Real estate broker's commissions, title insurance, legal fees, administrative costs and inspection fees are all considered selling costs. Selling costs can also include items otherwise considered repairs—painting, wallpapering, planting flowers, maintenance and the like—provided you complete them within 90 days of your sale and provided they were completed to make the home more saleable.

As the time nears to pay your dues in Club America, your home offers financial shelter from what otherwise could be a taxing expense—especially if you've sold your home when your tax returns are due. The Taxpayer Relief Act of 1997, credited with having a significant role in keeping the real estate sector ahead of the rest of the economy, is perhaps the best tax shelter your home provides. Generally, the federal tax law says when you sell your home, if you qualify, you can keep, tax free, capital gains of up to $500,000 if you are married filing jointly or $250,000 for single taxpayers, or married taxpayers who file separately. Under the law, to qualify for the $500,000/$250,000 exclusion, the home must have been your primary residence for at least two of the prior five years. The exclusion is not a one-time deal, but a benefit you can use again and again, theoretically every two years -- provided you qualify each time by meeting the owner-occupied-two-out-of-five-years

Expect the home-purchase market to strengthen along with the economy in 2015, according to Freddie Mac's U.S. Economic and Housing Market Outlook. "The good news for 2015 is that the U.S. economy appears well-poised to sustain about a 3 percent growth rate in 2015 — only the second year in the past decade with growth at that pace or better," says Frank Nothaft, Freddie Mac's chief economist. "Governmental fiscal drag has turned into fiscal stimulus; lower energy costs support consumer spending and business investment; further easing of credit conditions for business and real estate lending support commerce and development; and consumers are more upbeat and businesses are more confident, all of which portend faster economic growth in 2015. And with that, the economy will produce more and better-paying jobs, providing the financial wherewithal to support household formations and housing activity." Freddie Mac economists have made the following proje

A home warranty is a very important aspect of the real estate transaction providing many benefits during the marketing period, while the home is in under contract and after the close of sale. Homes with home warranties tend to sell faster and closer to the asking price - minimizing marketing efforts Reduced after sale hassles - when a buyer experiences a breakdown, they call the warranty company It’s smart to have a home warranty plan. Fidelity National Home Warranty offers a Comprehensive Plus Plan. Check it out at homewarranty.com.

It is a misdemeanor to act as a contractor while working under a suspended license. Any advertisement for unlicensed work is only legal if the aggregate contract price for labor and materials is less $500. This law provides that, unless exempted, it is a misdemeanor for a person to engage in the business of, or act in the capacity of, a contractor while his or her license is suspended. The Contractors’ State License Law presently provides that it is a misdemeanor for any unlicensed person to advertise for construction or work of improvement unless that person states that he or she is unlicensed in the advertisement.   This law additionally prohibits an advertisement for construction work or a work of improvement by an unlicensed person unless the aggregate contract price for labor, materials, and all other items is less than $500, and the work or operations are casual, minor, or inconsequential. Senate Bill 315 codified as Business and Professions Code §§7011.4, 7027.

Consumers cannot be forced to waive right to make critical or disparaging statements about a business. This law prohibits a contract or proposed contract for the sale or lease of consumer goods or services from including a provision waiving the consumer’s right to make any statement regarding the seller or lesser or its employees or agents, or concerning the goods or services. It imposes civil penalties upon any person who violates the provisions of the law, of $2,500 for the initial violation and $5,000 for each subsequent violation, as well as an additional penalty of $10,000 if the violation was willful, intentional, or reckless in actions that may be brought by the consumer, the Attorney General, or a district attorney or city attorney. It does not prohibit or limit a person or business that hosts online consumer reviews or comments from removing a statement that is otherwise lawful to remove. Assembly Bill 2365 codified as Civil Code 1670.8. Effective January 1, 2015.