Capital Gains Tax Partial Exclusion on house sale

6 replies
58 views

My wife and I bought a house less than 2 years ago.

When we bought the house she worked at a location 4 miles from our house.

Then, she got a job 57 miles from our house through an agency. For this job the agency was her employer and not the hospital where she worked.

Shortly after that she was hired by the hospital, so she still works 57 miles away, but got a new job and employer at that same location.

We know that if you get a new job more than 50 miles away from your old job that you get a partial exclusion. So, our question is does it matter that her employer changed while she worked at this location? It's more than 50 miles further than the job she had when we moved here, but she did switch employers at her new location, does that matter?

Thanks!

Not A Product Question

Mike9241Answer

Level 15

I work from home for both my current and previous job. We are moving because of my wife's job change, but the first job there was just temporary, so we didn't want to move for that, when it became permanent then we wanted to move closer.

the job relocation exclusion is for those whose principal reason for moving is because they get a job at a new location or those with no former job moving to get a job. however, if your old home has become unsuitable for your work, then this could be a move for unforeseen circumstances which would qualify you for the partial exclusion. if this could be your situation, it should be discussed with a tax pro who could give over the facts in more detail

Mike9241

Level 15

quote from IRS regulations

The qualified individual's new place of employment is at least 50 miles farther from the residence sold or exchanged than was the former place of employment,.....

but got a new job and employer at that same location (?)

so to qualify under the job move exception since she previously worked 57 from the old home her new place of employment would have to be 107 miles from the residence sold.

based on what you provided, since the location of the "new" employer is the same as the previous one, the sale of the home would not qualify for any exclusion.

job locations prior to the last one before the move are irrelevant

Mike9241

AnEntireCakeAuthor

Level 2

Thanks you!

Mike9241

Level 15

what about you and your old and new job location - no change? what is the reason for the sale? - there could be another exception such as for health reasons or unforeseen circumstances which covers a vast array of possibilities.

Mike9241