Investors & landlords

If your brother owned the duplex and lived in one unit as his primary residence for the last 2 out of 5 years leading up to the sale, he can exclude some (or all) of the capital gain on that unit (only). 

 

Since you will not have used that unit as your primary residence for the last 2 out of 5 years leading up to the sale (it's already been circa 3 years since you moved out), you will not be able to take advantage of the home sale exclusion.

 

See https://www.irs.gov/taxtopics/tc701

 

 

There is really no way to avoid any depreciation recapture and, hopefully, you and your brother have been treating the two sides as separate living units and taking depreciation deductions only on the unit that was being held for rental use.