Where do I declare the sale of our primary residence in France? And do I enter the Dec 31 2020 Dollar equivalents for our original 2005 purchase and sale prices?

[kir8]

Our French lawyer prepared a doc showing the difference between what we paid for the apartment, and what we sold it for, (minus fees) was a gain of 250 Euros.  I'm hoping I can use this to enter in values to calculate our capital gains (which we already paid french taxes on).  Hoping this amount is so low, that it is easy to report on, without worrying about exceptions.  thanks a lot!

[RayW7]

You must report the sale of your home just like everyone else, just as you would if it were situated in the U.S. That's because the United States taxes its citizens on their worldwide income.

If the real estate was your principal residence and you lived in and owned the house for at least 24 out of the last 60 months ending on the date of the sale, you can exclude $250,000 of capital gains from taxation. This increases to $500,000 in capital gains if you're married and you and your spouse file a joint return. 

The sale will need to reported (converted into US dollars) on your tax return as the sale of a capital asset. 

You won’t pay taxes on the first $250,000 (also known as a gain) you make from the sale of your home. If you file jointly, you won’t pay taxes on the first $500,000.

That income is free and clear  as long as:

• You owned the home
• It was your main home for two years or more within the five years leading up to the sale
• You waited at least two years between selling your primary home and excluding your first $250,000 or $500,000 from taxes. In other words, you may buy and sell as many primary homes as you'd like, but you'll only get this tax benefit every two years.

 If you do have a gain on the sale, you may utilize foreign tax credit to help offset any double taxation.

[kir8]

Thank you so much for your response Ray!  So to declare, I would enter it in the same place as if this was a US based primary residence sale? If so, the entry fields were requesting city state and zip, and I wasn’t sure if there was a trick to get  it to accept entry of city, country and zip.

For that entry, if I am to enter a converted dollar amount (Euros to dollars), I believe  I would use a Dec 31 2020 treasury conversion  table to calculate sale amounts minus fees for the year we sold it.  Would I also need to go back to a Dec 31 2005 table for the treasury conversion rate for calculating our purchase amount plus fees? (2005 being the year we purchased  the condo)

We lived in our old condo for 3 years as our primary residence, before purchasing  a bigger condo with the proceeds of the sale. I’m not interested in excluding our capital gains, as they totaled 250 Euros, and I already paid the French taxes of 22 euros, on that gain. Thank you for letting me know we could deduct that via a foreign tax credit.  If/when we need to sell the new place, I’ll plan to use the primary exclusion at that time.

[LinaJ2020]

Yes, you can try to leave it blank for the address.  It is not required and you do not have to enter an address. You can simply skip that part.

Yes, that will be recommended. You should do the conversion based on it's historical date.  Click here: https://www1.oanda.com/currency/converter/

If you pay taxes to both US and France on the gain, you may claim a foreign tax credit on Form 1116.

Here are the steps: 

• Open up your TurboTax account and select Pick up where you left off
• At the right upper corner, in the search box, type in "foreign tax credit" and Enter
• Select Jump to foreign tax credit
• Follow prompt

It will show on line 1 Schedule 3 and line 20 of your Form 1040.