Hello, I bought my grandparents farm for 440,000, June 2023. Every time we tried to move in we got sick and had to move out. We spent about 110,000 fixing it up and trying to fix what we thought was causing our symptoms. We could not figure it out and gave up selling it for 665,000 November, 2024. We only spent about a total of 8 nights there due to our symptoms.
I heard you can get a partial exclusion for medical reasons for selling the home. AKA, I would not owe the usual capital gains due to not living in it for 2 years before selling it.
However, it looks like that is only the amount of time actually occupied in it would be counted in Turbo Tax so only 8 days.
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However however, I read some additional knowledge:
The IRS doesn’t calculate the exclusion based solely on days physically lived in the home. Instead, they look at the time owned and the unforeseen reason that prevented meeting the two-year residency requirement. For a partial exclusion, you calculate based on the portion of time owned and used as your residence within the two-year period. However, the "use as your residence" can include situations where you intended to live there but were prevented due to medical reasons.
So, the calculation I provided earlier (18 months / 24 months = 75%) is more aligned with IRS guidance for unforeseen circumstances. The 8 days of occupancy alone shouldn't determine your exclusion, as your intention to live there, health issues, and ownership period all factor into the eligibility for the partial exclusion.
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is this possible to account for in Turbo Tax? Or do I need to hire a professional
