First of all, we should answer the following question: 'Do I have to pay taxes selling my land?' You could be subject to as many as four different taxes. Your profit on your land will be taxed at the federal capital gains rate, which (for the tax year 2015) is 15 percent or 20 percent for assets held over one year, depending on your income. You could also be subject to a 3.8 percent surcharge tax for Medicare as well as 25 percent depreciation recapture tax on any depreciated land.
If you sell your land for less than what you paid for it and less than the value after adding up any depreciation that you claimed, you won't have to pay any taxes. While this is not always a desirable option, it can be a way to get out of the expense of holding land for which you have no other use.I can provide you some rules for how to avoid taxation.If your land is officially considered as “agriculture land” you don’t have to pay taxes.But we might read the following terms.
Your territory is agriculture land if:
1 )It is situated in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand according to the last preceding census of which the relevant figures have been published before the first day of the previous year;(There are 42,108 people in Dubbo)
2) It is situated in any area within such distance, not being more than eight kilometers, from the local limits of any municipality or cantonment board referred to in item (a), as the Central Government may, having regard to the extent of, and scope for, urbanization of that area and other relevant considerations, specify in this behalf by notification in the Official Gazette.
So, if all conditions are satisfied, your land is considered to be agriculture land, and it is not liable for taxes.Also, according to the terms of the IRS's Section 1031 regulations, an individual who purchases a new piece of property within 180 days of completing the sale of his or her "old" property may be exempt from taxation on the sale's proceeds. In other words, you can avoid paying capital gains taxes on the sale of your land by purchasing another land within a relatively short period of …