How to Sell Home Capital Gains in Fort Collins [Expert Advice from The Levi Group Brokered by Real]

How do I handle capital gains tax when selling my home in Fort Collins?

If you're selling a home in Fort Collins, understanding how capital gains taxes work can save you thousands. In most cases, if the home has been your primary residence for at least two out of the past five years, you may qualify for a significant tax exclusion. That said, your specific situation—such as investment properties or recent relocations—can influence what you owe. Always consult with a licensed tax advisor before making any decisions.

What Are Capital Gains on a Home Sale?

Capital gains refer to the profit you make when you sell your home for more than you paid. For example, if you bought your Fort Collins home for $350,000 and sell it for $500,000, your gain is $150,000. That amount may be subject to federal (and possibly state) capital gains tax—unless you qualify for an exemption.

Federal Capital Gains Exclusion for Primary Residences

Under IRS rules, homeowners can exclude up to:

• $250,000 of capital gains if you're single

• $500,000 if you're married and file jointly

To qualify, you must:

• Have owned and used the home as your primary residence for at least two of the last five years

• Not have excluded gains from another home sale in the last two years

Example:

You and your spouse bought a home in Rigden Farm in 2018 for $400,000 and are selling it for $625,000 in 2025. Your gain is $225,000. Because you meet the criteria above, the full gain is likely excluded from taxation.

Fort Collins Market Considerations

In Fort Collins, home values have appreciated significantly over the last decade. If you've owned your home since before 2015, there's a good chance you've built substantial equity. However, this appreciation also increases the likelihood of hitting the capital gains threshold, especially for:

• Homes in high-demand neighborhoods like Old Town, Harmony Corridor, and Fossil Lake Ranch

• Long-held rental properties or inherited homes

• Sellers who made major home improvements that increased value

Can You Avoid or Reduce Capital Gains?

Yes, and here are a few strategies:

1. Live in the Home Longer

Make sure you meet the 2-out-of-5-year primary residence requirement.

2. Track Home Improvement Costs

Capital improvements (like a new kitchen or roof) can increase your cost basis and reduce your taxable gain.

3. Convert a Rental to a Primary Residence

You may still qualify for a partial exclusion if you've lived in a rental before selling.

4. Consult a CPA or Tax Attorney

These professionals can help optimize your tax situation and identify deductions or exemptions specific to Colorado real estate laws.

What About Investment or Rental Properties?

Selling a rental home in Fort Collins? Unfortunately, the capital gains exclusion does not apply to investment properties. But you may still be able to:

• Defer taxes through a 1031 exchange (if you reinvest in a similar property)

• Offset gains using expenses, depreciation, or capital losses

Again, professional tax advice is essential here.

How The Levi Group Brokered by Real Helps Fort Collins Sellers

At The Levi Group Brokered by Real, we’ve helped hundreds of Fort Collins homeowners navigate equity-rich home sales. Here’s how we help:

• Net sheet estimates: We’ll break down your expected proceeds and possible tax exposure

• Vendor referrals: From CPAs to title companies, we connect you with trusted experts

• Local expertise: We help time your sale for maximum value while managing disclosures and prep

Whether you're downsizing, relocating, or cashing out an investment, we ensure you understand every financial implication before you list.

Final Thoughts

Capital gains taxes don’t have to catch you off guard. With early planning and local expertise, you can sell your Fort Collins home with confidence—and keep more of your profits.

Ready to sell smarter, not harder? Contact The Levi Group today for your free consultation.
📞 Call or Text: (970) 426-8916
📧 Email: jason@thelevigroup.net
🌐 TheLeviGroup.net

Disclaimer: This article is for informational purposes only and does not constitute legal, financial, or tax advice. Please consult with licensed professionals regarding your specific situation.