Unfortunately, rolling over the gain into a new primary residence doesn't affect whether it's taxable or not. That said, if all of the following apply, you don't need to report the sale.
- You lived in the home as your main home for at 2 of the 5 years preceding the sale.
- Your "net" profit from the sale is less than $250,000 ($500,000 if Married Filing Jointly).
- You didn't take depreciation deduction on the home or use it for business during the time you owned it.
- You didn't rent it out at any time that you owned it.
- You didn’t receive a Form 1099-S.
If you are required to report your home sale, there will be a space in the software to enter the date sold, Selling Price, and Sales Expenses. You can deduct the items listed below in Sales Expenses. You cannot deduct normal maintenance items, but you can deduct expenses to prepare the home for sale.
Sales expenses are listed in the sellers column of your settlement statement and include:
- appraisal fees
- broker's fees
- legal fees
- advertising fees
- home inspection reports
- title insurance
- transfer taxes or fees
- geological surveys
- loan charges (points) or other fees paid on the buyer's behalf
- any fees for a service that helped you sell your home without a broker (listing fees, promotional fliers, etc.)
Sales expenses do not include:
- mortgage payoffs
- home equity loan payoffs
- rent-back costs
- payoff to creditors
- property taxes
- home owner association fees
Is the Sale of My Main Home Taxable?