If you owned and lived in the home for a total of two of the five years before the sale, then up to $250,000 of profit is tax-free (or up to $500,000 if you are married and file a joint return). If your profit exceeds the $250,000 or $500,000 limit, the excess is typically reported as a capital gain on Schedule D.
Therefore, for your peace of mind, you can file your return even if you don't make these profits but you don't have to, especially with the fact that your only other source of income is Social Security benefits.
See additional information below:
Sale of Home
@TerrylynnE
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