@Opus 17 wrote:
No. That section applies to people who move out early, after less than 2 years of ownership. It does not apply to people who move out late, after the expiration of the 3 year grace period.
but fails to satisfy the ownership and use requirements described in § 1.121-1(a) and (c) or the 2-year limitation described in § 1.121-2(b)
Where do you see that? It says it applies to those who do not meed the 2/5 rule (or the 2-per-year rule). That applies to this situation.
@Opus 17 wrote:
you would be defeated by b(1) and b(4), "The sale or exchange and the circumstances giving rise to the sale or exchange are proximate in time;" and "The taxpayer uses the property as the taxpayer's residence during the period of the taxpayer's ownership of the property;" The sale (38 months after the job change) is not proximate in time to the job change and the taxpayer was not using the home as their main home.
If a safe harbor described in this section applies, a sale or exchange is deemed to be by reason of a change in place of employment, health, or unforeseen circumstances.
If a safe harbor described in this section does not apply, a sale or exchange is by reason of a change in place of employment, health, or unforeseen circumstances only if the primary reason ...
The Safe Harbor overrides (1) and (4). Those only come into play if the Safe Harbor does not apply.
