The amount of depreciation that was allowed will be completely taxable up to the amount of gain received on the sale.
The remaining gain if any, will be split between taxable and amount eligible for exclusion by using the following formula.
The total days available for rent will be divided by the total days owned to determine the portion of the remaining amount of gain that is taxable for the rental period
The balance will be eligible for the home sale exclusion
TurboTax will do all the calculations based on your entry.
I understand that is what is _supposed_ to happen, but the #3 specifically is not happening: instead, it just says "you don't qualify for an exclusion" and treats the entire gain as taxable :(
