Carl
Level 15

Deductions & credits

...am I liable for any capital gains tax from the sale ?

 

Short answer is yes. However, you "may" qualify for an exception that may give you at least a partial exclusion under the "lived in 2 of last 5 years" rule.

First, if you lived in the property as your primary residence for at least 2 years (730 days) of the last 5 years (1826 days) you owned it, then you can exclude up to $250,000 if single, or $500,000 is married filing joint (and you both lived in the house) from taxable income.

If you lived in the property less than 2 years (730 days) and your move is required for employment or continued employment, then you can probably qualify for a partial exclusion based on the number of months you did live in the property as your primary residence. Basically, you can exclude 1/24 of the allowed amount for each month the house was your primary residence.

There are other requirements which I've not addressed here, and you probably most likely will meet those requirements. The program will walk you through it just fine. Just make sure you read everything on every screen as you work it through. The small print does matter - big time.