The rules are the same. You must meet the exclusion to be able to take the exclusion. However, you must still recapture any depreciation that you took.
There will be a screen in the rental section to indicate that it was also your primary home.
You won't pay taxes on the first $250,000 (also known as a gain) you make from the sale of your home. If you're Married Filing Jointly, you won't pay taxes on the first $500,000.
That income is free and clear as long as:
- You owned the home
- It was your main home for two years or more within the five years leading up to the sale
- You waited at least two years between selling your primary home and excluding your first $250,000 or $500,000 from taxes. In other words, you may buy and sell as many primary homes as you'd like, but you'll only get this tax benefit every two years.
