Federal Revenue Office expands Income Tax exemption on capital gains with real residential property

Exemption becomes applicable to sales of one real property whose goal is paying up another piece of real property

The Federal Revenue published, on March 17, the Normative Instruction No. 2,070/2022, which amends previous rules related to Income Tax exemptions on the capital gain originated from the sale of real residential property.

This measure is beneficial to the taxpayer, for it adopts the exemption on the cases in which the sale of real residential property aims at paying up, either partially or totally, the remaining debt of a purchase on credit or on the provision of a real residential asset that the transferor already possesses.

The exemption is valid as long as the seller, on a 180-day deadline counted from the execution of the contract, applies the product of such sale into the acquisition and/or debt pay-up of real residential property, under their name, located in the country