Q. If I sell my home that I lived in for 24 months out of the last 5 years but it was rented the rest of the time am I still allowed the home sale capital gains exclusion?
A. Yes.
Furthermore, if the entire rental time occurred after you moved out, you do not have to prorate your exclusion amount. However, you do have to "recapture" (include as income) the depreciation you claimed or should have claimed.
The TurboTax (TT) interview goes smoother if you enter the sale as a home sale and not as the sale of rental property. You will make a single manual entry for the depreciation amount.
