Thanks for your clarification in this situation. If I understand you correctly, the late sale of the home resulted in not meeting the 2 out of 5 year criteria as house was "on sale" for 1.5 years and rented 2 years prior which is 3.5 years (so that max time it was used as primary residence is 1.5yrs out of the last 5). This would disqualify the exemption and would require capital gains from the sale.
I have something similar and although I did my best to sell the house to meet the 2/5 year primary residence requirement, due to unforeseen circumstances (COVID19), it took longer than expected resulting is over 1 year of empty home (not intended to be rented) taking away time such that I can only meet 1.5/5 year. Is there a way to get partial exclusion in this case due to unforeseen event? Many thanks!
