When I got married in 2016 I already owned a home. I started renting it out and sold it in 2019. I meet the use and ownership test on that house to claim the exemption.
Additionally, in 2017 my wife took out a mortgage to buy a house and I was added to the deed as I'm her spouse.
So I would like to know if I can claim the $250k exclusion on the house I owned prior to marriage and my wife can claim the $250k exclusion for the house she bought once we were married?
I was the only one on the deed for my house and the one that was bought after being married had both our names on the deed.
Both homes were sold in 2019.
On an individual basis we both seem to qualify for the ownership and use test.
The IRS states that if a married couple does not qualify for the $500k exclusion( which we wouldn't because I would be claiming the exclusion on my original house so I wouldn't be eligible to do it again for the sale of the other house) that " the exclusion is figured separately for each spouse as if they are not married. This means they can EACH qualify for up to a $250,000 exclusion. For this purpose, each spouse is treated as owning the property during the period that either spouse owned the property during the period that either spouse owned the property. For joint owners up to $250,000 of gain is tax free for each qualifying owner."
Looking for a confirmation in my findings.
Thank you
