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capital gains-ex fiance

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goodcraic

Guest
What is the name of your state? California
Purchased a house with my EX-fiance 2 years ago. Relationship didn't work out. I moved out one year ago. He wants to buy me out of the house, but for less than I am due. He says that if I try to fight him on it, that he will not let me claim that I lived there for two years and therefore I would have to pay capital gains. The current law seems vague as far as "unforeseen circumstances" if we weren't married. Can I fight him about the equity or is he right. The monitary difference is about what I would have to pay the IRS for capital gains Can you give me a clarification on the law?
 


abezon

Senior Member
Breaking up is an unforseen circumstance. I don't think you need to worry about it. Just take a prorated exclusion -- based on the number of days furing the last 5 years that you actually lived there. You don't have to live there for 2 years if you have to sell due to unforseen circumstances.

If he doesn't buy you out at fair market value, tell him you'll sue for partition by sale & he can try to outbid all other offers if he wants to stay in the house. In a partition by sale, the court orders the sale & splits the money between the owners. You can apply the exclusion to any gain at that time. You'll need a lawyer to do this.
 
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goodcraic

Guest
thanks, that's what I thought. Since we have both been on the title for 2 years, I don't think the "little IRS spies" will hunt me down.
Now, about fighting him on the division of the house. I've been hesitant to do it because of the money...the cost of continuing to rent and the legal costs. Approx how long do you think it would take and what type of cost would I be looking at? He also says that he has more legal rights to the house because he is living there...is that true?
What is the best way to find a reputable attorney for this? What type of lawyer would it be?
Thanks again! You guys are great!
Lisa
 

abezon

Senior Member
You'd need a real estate atorney. He doesn't have more rights to the house bexause he's living there. In fact, your attorney would probably argue that he owes you rent since he's denied you use of the house. This is then offset by the fact that he paid all the expenses (presumably).

If you want to force the buy-out, just move back in. It's your house too; you have just as much right to live there as he does. He cannot stop you from moving in. He can't even stop you from renting out the house (although be sure to tell the tenants he'll be there). You'd have to share 1/2 the rent, but since he's paying all the expenses, you're getting the better part of the deal.
 
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goodcraic

Guest
Thanks! that's beautiful if it is true! I'll go first thing in the morning and get a renter and an attorney! :)
 

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