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Deductions & credits
The wording of the statute governing the capital gains exclusion is this:
"Gross income shall not include gain from the sale or exchange of property if, during the 5-year period ending on the date of the sale or exchange, such property has been owned and used by the taxpayer as the taxpayer’s principal residence for periods aggregating 2 years or more."
https://www.law.cornell.edu/uscode/text/26/121
If your 3 periods of use after September 1, 2019, were temporary in nature, and the house was no longer your "principal residence" after that date, then an IRS auditor would likely deny a claim of the full exclusion.
**Answers are correct to the best of my ability but do not constitute tax or legal advice.
June 11, 2023
11:32 AM