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dmdegrazia
New Member

Got a letter from the IRS CP2501 and i don't know what to do.

I sold a house in Michigan on Nov 13, 2015 and bought a house in Florida for more money on Nov 30, 2015.  I didn't know i had to file anything on my tax return.
1 Reply
Coleen3
Intuit Alumni

Got a letter from the IRS CP2501 and i don't know what to do.

Was it your primary home? See below. If it was a second home or a rental, you would always have to report it.

You do not need to enter the sale of your primary residence if:

  • You never used your primary residence as a rental
  • You have a loss on the sale of your home (Personal use capital losses are not reported on your tax return)
  • You did not receive a Form 1099-S and
  • You meet the home gain exclusion

If you still need to enter your sale of your primary residence, please follow these steps:

  1. Once you are in your tax return (for TurboTax Online sign-in, click Here), click on the “Federal Taxes” tab ("Personal" tab in TurboTax Home & Business)
  2. Next click on “Wages & Income” ("Personal Income" in TurboTax Home & Business)
  3. Next click on “I’ll choose what I work on”
  4. Scroll down the screen until to come to the section “Less Common Income”
  5. Choose “Sale of Home (gain or loss)” and select “start’
  6. You will want to use the "Easy Guide" to determine the adjusted basis on this home 

If this was your primary residence, you may be eligible to exclude the gain under the home gain exclusion.

You can take the gain exclusion as long as you considered the home your "primary residence" for 2 of the last 5 years. If you have a capital gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income. You may qualify to exclude up to $500,000 of that gain if you file a joint return with your spouse. 

If you did not use the home as your primary residence for 2 of the last 5 years and meet the home gain exclusion requirements, you may still be eligible for partial exclusion if you can show the main reason you sold your home was because of a change in workplace location, for health reasons, or because of an unforeseeable event

See Sale of Your Home for more information on the exclusion.

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