capital gains from sale of a marital home after a divorce

Forum|Forum|3 years ago
November 16, 2022
1 reply
4 views

Hi. Married September 2013. Bought a home in Colorado with my wife (both names on deed and loan) in approx July 2019. She and I were living in an apartment in a different town in Colorado for the previous year. She moved into the house and I was to move there later. I visited her (in our house) regularly until we divorced in September 2019. Home loan was in both names and spouse put $50K down. As part of divorce, I paid this mortgage for just under 3 years. We sold in approx April of 2022 with approx $200K in profit. She got the first $50K back, and we split the balance (approx $75K each). Question is, can I avoid capital gains tax? Thanks.

drc845443

Level 6

Hello there!

Based on the information you have provided, it seems unlikely that you could qualify to exclude the gain from income.

To qualify to exclude the gain, you need to meet the following requirements:

You owned the home for a total of at least two years.
You used the home as your primary residence for a total of at least two years in last five-years before the sale.
You haven't excluded the gain from another home sale in the two-year period before the sale.

From your information it does not appear that you used the home as your primary residence as required in point 2 above.

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