Hi LV44,
When a home owned by three unrelated individuals is sold, each owner reports the sale in the proportion of their ownership. Assuming they own the house with joint tenancy, meaning all owners have equal rights, each person would report 1/3 of the gain. Since the home is the primary residence for some of the co-owners, those individuals may be able to exclude up to $250K of the gain from taxable income if they meet the other requirements for gain exclusion.
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Kimberly, CPA for over 30 years
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