@mack12345 wrote:
@LeonardS For the property that was my residence for roughly 13 years, then a rental for roughly 3 1/2 years, then my residence again for little over 2 years... I used Turbo Tax for 2019 entered the number of days as rental. In 2019, it was rented 274 days Jan 1-Oct 1, 2019). Then it became my residence (Oct 2-,2019). I need to know if there is anything else I should have done on my 2019 taxes to indicate it became my residence on a certain date (Oct 2,209) as I barely met the 2 year out of 5 year rule on COE Oct 8, 2021. Thank you
Because you moved out, then back in, the period of time the home was a rental will be "non-qualified" for the exclusion. There is a worksheet in publication 523, but I believe Turbotax will handle the calculation correctly. Essentially, 3/18th of your gain is not eligible for exclusion, plus you need to pay recapture on depreciation you took or could have taken while the home was a rental. Then, the remaining gain is eligible for the exclusion.
If audited, you do want to be able to prove the important dates.
