Purchased a home in 2011 which had a second lot of land adjacent to hold the leaching field for the primary residence. In 2018, the leaching field was moved to the primary house lot which left the adjacent lot available to be used for other purposes. Both lots are listed for sale in 2018, but Buyer only purchased primary house lot in August, 2018, and declined to purchase the adjacent lot. Therefore, ownership of the empty lot was retained and which required the payment of real estate land taxes, engineering studies and a variance to complete a sale to another buyer. The variance application was filed in 2019, however, due to the Covid19 pandemic there were numerous delays, including multiple extended month long continuances of hearings by the town Board and the required variance to sell the property was not obtained until February 1, 2022 and the sale was quickly closed in May, 2022, outside the IRS 2 year window for sale. Can we claim "unforseeable events" and apply the remainder of our primary residence capital gains tax exclusion to include the sale of the adjacent land or are we now required to pay a long term capital gains tax on this delayed sale??
