So simply (if possible) speaking, as long as the rental period ( 2 years) happened before I converted it to a primary residence, no matter how long I live in the house as primary residence (i.e. 2 years, 5 years, or 20 years), when I sell my house, I always need to prorate the gain based on the ratio ( 2 divided by total owning years)?
The part I don't understand is the Worksheet 3 Section B. Determine your non-qualified use gain. Complete this section only if there is a period, after the year 2008, when neither you nor your spouse (or your former spouse) used the property as a main home, and that period of non-use occurred during the 5-year period prior to the date of sale and before the time when you or your spouse (or your former spouse) used the property as a main home.* Otherwise, skip to Section C. "
