Any gain that you postponed on earlier sales under the old law should have been subtracted from your basis on either the 1997 sale or the 2004 sale. Whichever date it was, you no longer have any postponed gain. So your basis for the house you bought in 2004 is the amount you paid for it, plus the cost of any improvements. It is not affected by any of the earlier sales.
Here is a more detailed, and somewhat confusing, explanation. But this is just background information. It does not affect the basis of your current house.
The change in the law was effective May 7, 1997, so it makes a difference whether the closing date for the sale of the house you bought in 1990 was May 6,1997 or earlier, or May 7,1997 or later. If the 1997 sale closed on or before May 6, any gain on that sale that you deferred under the old law should have been subtracted from your basis when you sold your house in 2004.
If the 1997 sale closed on May 7 or later, you could not have postponed any of the gain. Any postponed gain from earlier sales should have been subtracted from the basis of the house that you sold in 1997.
Either way, all of your postponed gain was accounted for in 1997 or 2004. And in any case, you could not have postponed any gain from the 2004 sale. So you no longer have any postponed gain, and the earlier sales do not affect the basis of the house that you are selling now.
