Irs Homeseller Provision and Urban Decline

ABSTRACT:

This study involved an analysis of the movement of homesellers and the geographic pattern of home values in the Cleveland metropolitan area, taking into account the application of Sec. 1034 of the IRS Code. S 1034 allows homesellers to defer tax liability on capital gain realized through homeownership by purchasing another home of equal or greater value. The study concludes that in metropolitan areas where values increase in an outward direction, S. 1034 contributes to urban decline by encouraging outmigration and obstructing movement inward.