How does the capital gains tax on a home sale work right now?

Selling a home triggers federal capital gains tax on the profit above what the seller originally paid plus qualifying improvements, though a portion of that gain can be excluded if the home was the seller's primary residence and ownership and use requirements are met. Gains above the excluded amount are taxed at capital gains rates, which differ from ordinary income tax rates and depend on how long the property was held. South Carolina does not add a separate state-level home sale tax on top of the federal capital gains rules. A CPA can calculate the actual gain and tax owed for a specific sale.