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kenk5
Returning Member

Selling a rental property converted from primary residence with capital gains

I bought a home in 1990 for 80k, remodeled it in 2003, moved out of state and rented it out for ❤️ years then sold it for 290k.  I have lived in it as a primary residence for 2 of the last 5 years, but the last almost 3 years it was a rental. 

Is there a way to avoid capital gains tax?  I calculate gains to be about 110k.

I had it in TurboTax as rental property and am trying to sort through it in TurboTax.

Thanks

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4 Replies
kenk5
Returning Member

Selling a rental property converted from primary residence with capital gains

Where in TurboTax premium do I add the house sale?
AlanT
Expert Alumni

Selling a rental property converted from primary residence with capital gains

If you qualify for the exclusion to make all of your profit tax-free, don't report the home sale. But make sure all your paperwork is in order to show the IRS if it asks.
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AlanT
Expert Alumni

Selling a rental property converted from primary residence with capital gains

The IRS has a provision that can help homeowners avoid capital gains on the sale of their primary residence.

To qualify, 

  1. You must have owned your home and used it as your main residence for at least two years in the five-year period before you sell it. 
  2. You also must not have excluded another home from capital gains in the two-year period before the home sale. 
  3. If you meet those rules, you can exclude up to $250,000 in gains from a home sale if you’re single and up to $500,000 if you’re married filing jointly.
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kenk5
Returning Member

Selling a rental property converted from primary residence with capital gains

That is what I thought, but how do I enter it in TurboTax premier.  I followed instructions in this forum (add the house under rental assets) and it says I owe capital gains tax.  before selling it in 2018 it was a rental. thanks.
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