Deductions & credits

Each spouse receives an individual $250,000 exclusion from capital gains for sale of their personal home.  Even if one spouse moved out due to a divorce, they still qualify for the exclusion as long as the other spouse used the home as their main residence.  The gain is the difference between the selling price and the purchase price.  If the gain is more than $500,000, you will be responsible for capital gains tax on your half.