@caperomie wrote:
Hi there, i have a somewhat tricky question that is baffling me and i am not able to find the answer, will try to explain here.
current date is 9/20/2021.
i have a home purchased on October 2020 which i use as a primary residence, i am also buying another home in same city which will be ready on Feb 2022 , builder is asking me to occupy the new house as primary residence for two years. here is my dates:
1st house purchase date = 10/2020
lived in 1st house until = 1/2022 (15 months)
moved back to 1st house = 3/2024
proposed sold date1st house = 1/2025
If the first home was you principal residence for at least 730 days during the 5-year period before it was sold, it will qualify for AN exclusion. But in your situation, you only qualify for a prorated exclusion. As you said, if it was your main home for 24 months out of a total ownership period of 48 months, you will only qualify to exclude 50% of the gain due to the "nonqualified use" during the time you did not live there (not including any gain due to depreciation, which is also taxed).
