Don't Make This $500,000 Tax Mistake When Selling Your Home in Palm Beach County

1. Introduction
Should I sell my home in Palm Beach County or should I rent it out? Today I want to share a quick story to help you think this through.

2. Important Disclaimer
I am not a tax advisor. For any tax advice, speak to your own CPA (as I did).

3. Background
My wife, Candace, and I lived in our Fort Lauderdale home for about seven years before building our house in Jupiter. Once we moved, our plan was to rent out the Fort Lauderdale property.

4. The CPA Conversation
I called my CPA and said, “We’re going to rent the house out. What do I need to do from a tax perspective?”
He stopped me and asked: Had we lived in the house for at least two of the last five years, was it owner-occupied, and did we file homestead? Yes to all.

He explained that because we’re married, if we sold the house, we could qualify for up to a $500,000 exclusion on the gain (it would be $250,000 if single). His recommendation: sell the property, take the gain, then open an LLC for future investments to access different benefits and separate from our personal names.

5. Why Timing Matters
If we had rented the home first and decided to sell in year three or four, we could have lost access to that exclusion and been hit with capital gains we could have avoided by selling at the right time. In our case, the gain exceeded $500,000, and we minimized a lot of tax by selling when we did.

6. Takeaways for Homeowners
If you’re upsizing (e.g., moving from a condo or townhome into a single-family home) and thinking, “We’ll just keep the old place and rent it,” pause and call your CPA first. Depending on your situation, it may be smarter to sell and redeploy the proceeds rather than rent and risk a larger future tax bill.

Your situation may differ—get professional tax advice.

7. Contact
Questions or want to talk through your options?

• Call/Text: 786-443-7203

• Email: caseypindle@gmail.com