Thinking of selling your home or investment property in Coastal Georgia or Northeast Florida? Before you list it, it's important to understand how Capital Gains Tax could affect your sale. While we aren’t tax professionals, we are trusted local real estate experts — and we’re here to help you make the most of your move.

At Atlantic Salt Realty, we specialize in helping clients maximize their home sale, navigate the buying process, and find the perfect coastal property. Whether you're selling a primary residence, vacation home, or investment property, our team can guide you every step of the way — from understanding the basics of capital gains to preparing your home for listing.

Ready to get started? Contact us today for a no-pressure consultation — and let’s find the perfect next chapter for your coastal lifestyle.

💡 What Are Capital Gains?

Capital Gains Tax is a tax on the profit made when you sell a capital asset — like real estate — for more than you paid for it.

Example:
You buy a home in St. Marys, GA for $200,000 and sell it five years later for $300,000. That $100,000 profit is considered a capital gain — and is potentially taxable.

🔧 Adjusted Cost Basis: A Key to Reducing Your Tax Bill

The IRS lets you deduct certain costs and improvements from your gain to reduce the amount that’s taxed. This is called your adjusted cost basis.

What can be added to your cost basis?

• Closing costs (when you bought the home)
  
  
• Major renovations (new kitchen, new roof, room additions)
  
  
• Capital improvements that increase the value or life of the home
  
  

🛑 Routine maintenance like painting or plumbing repairs do not count.

Example:
You bought a home in Fernandina Beach, FL for $300,000.
You added a new $50,000 kitchen.
Your adjusted basis becomes $350,000.
If you sell for $400,000, your taxable gain is only $50,000 — not $100,000.

🕒 How Long You Owned the Property Matters

Capital gains tax is split into short-term and long-term rates:

• Short-term (1 year or less): Taxed as regular income (your W-2 rate)
  
  
• Long-term (1+ years): Taxed at reduced rates, depending on your income bracket
  
  

Tip: Long-term ownership usually means a lower tax bill.

🏠 Primary Residence Exemption

If you're selling your primary home, you may exclude up to:

• $250,000 of profit (if single)
  
  
• $500,000 of profit (if married filing jointly)
  
  

To qualify, you must have:

• Owned the home for at least 2 years
• Lived in it as your primary residence for at least 2 of the last 5 years

This rule is a major benefit to full-time residents of Georgia and Florida!

📍 Florida vs. Georgia: Capital Gains at the State Level

Florida

• No state income tax
• You only pay federal capital gains — which can result in major savings
  
  

This makes places like St. Augustine, Jacksonville, and Fernandina Beach especially attractive for investors and retirees.

Georgia

1. Tax-Friendly for Retirees

• Georgia does not tax Social Security benefits and offers a retirement income exemption of up to $65,000 per person (or $130,000 for couples) aged 65 and older on pensions, IRAs, 401(k)s, and other income sources.
•  
• Property taxes are relatively low, and there are homestead exemptions available for seniors, along with a lower cost living.
  
  

St. Marys, Kingsland, and Richmond Hill offer strong long-term appreciation and more affordable entry points.

📉 Depreciation & Real Estate Investors

If you’ve been depreciating your property on your taxes (common with rentals), that depreciation gets subtracted from your cost basis when calculating gains.

• This increases your taxable gain
• The portion tied to depreciation is taxed at your regular income rate, not the lower capital gains rate

Tip: Work with a tax advisor to plan your exit strategy, especially in high-income years.

💼 Common Capital Gains Strategies

Here are a few ways to reduce or defer your capital gains:

• 1031 Exchange: Reinvest the gains into another investment property
  
  
• Sell during a lower-income year
  
  
• Offset gains with capital losses (e.g., stock market losses)
  
  
• Convert investment property to a primary residence and meet the 2-year rule
  
  

🧾 Final Advice: Keep Records!

Whether you’re selling a cozy bungalow in Georgia or a luxury home near Florida’s coast, remember this golden rule:

Keep every receipt related to improvements and upgrades. It could save you thousands when tax season comes.

📣 Ready to Make a Move?

Navigating capital gains doesn't have to be overwhelming — especially when you have the right team by your side. While we always recommend speaking with a licensed tax advisor for your specific financial situation, Atlantic Salt Realty is here to help you sell smart, buy confidently, and find your dream home by the coast.

Whether you're planning your next move, downsizing, or looking for your forever home, we’ll provide the local insight, property expertise, and hands-on support you need.

Ready to get started? Contact us today for a no-pressure consultation — and let’s find the perfect next chapter for your coastal lifestyle.