More home sellers are paying capital gains taxes — here's how to reduce your bill

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More Americans are paying capital gains taxes on home sale profits amid soaring property values — but there are ways to reduce your bill, experts say. In 2023, nearly 8% of U.S. home sales yielded profits exceeding $500,000, compared with about 3% in 2019, according to an April report from real estate data firm CoreLogic. There's a reason the report called out that threshold. It's key for a special tax break for homeowners who make a profit when selling a primary residence. Married couples filing together can make up to $500,000 on the sale without owing capital gains taxes. The threshold for single filers is $250,000. More from Personal Finance: How to reduce taxes on your inherited individual retirement account, experts say Americans can't stop 'spaving' — here's how to avoid this financial trap Women farmers are key decision-makers, according to USDA data Those capital gains exemption thresholds haven't been indexed for inflation since 1997, said certified financial planner Jaime Quinones with Stockade Wealth Management in Marlboro, New Jersey. "With the recent rise in home values, more sellers have been facing a capital gains tax hit," Quinones said.