How to reduce taxes when you sell your home

If your home’s value has soared, congratulations. If you decide to sell, beware.

Financial advisor James Guarino says some clients don’t realize that home sale profits are potentially taxable until their returns are prepared — and by that time, they may have spent the windfall or invested the money in another house.

”They’re not happy campers when they find out that Uncle Sam not only is going to tax this as a capital gain, but they’re also going to have some exposure at the state level,” says Guarino, a certified public accountant and certified financial planner in Woburn, Massachusetts.

In my latest for the Associated Press, understanding how home sale profits are calculated and how you can legally reduce your tax bill.