selling house on disability

[sperts]

What is the name of your state (only U.S. law)? mi. hi my in law wants to sell his house and move into fed regulated housing his concern is can he avoid cap gains tax on his sale of home if he is already out? and if so what taxes will he face besides cap gains? and will they raise his rent at the fed housing if he gains this money in income for the sale of his house?his rent is based on a third of his income with a cap of course. what options does he have should he give most of the money away as gifts or is he worried over nothing and he wont be taxed that bad as the house still qualifies as his homestead he has only been out of it around four months. thank you in advance.

 

[tranquility]

If he owned and lived in the house for 2 of the last 5 years, as long as the sale is before January 2009, he could exempt the first $250,000 of capital gain. (The "profit" from selling the house.)

As to the others, I have no idea.

 

[LdiJ]

If he owned and lived in the house for 2 of the last 5 years, as long as the sale is before January 2009, he could exempt the first $250,000 of capital gain. (The "profit" from selling the house.)

As to the others, I have no idea.

And he may still get the full capital gain exclusion after January 2009 if the house is not used for any other purpose. Otherwise, he may get a reduced capital gains exclusion. Depending on how long he has owned the house, and its value, a reduced exclusion may not make any difference to him.

The rest of the questions depend on the rules for the "fed regulated housing" he has moved into.