You said it was never rented, so you never received rental income and I'm assuming you never claimed depreciation on the property in 2016 (even if you had you may still be exempt from capital gains tax). You have lived in the home for two of the last five years so you should be good to go. To be sure, just enter the sale of the home in TurboTax under "Sale of Home". That can be found by clicking on Personal tab at top, Continue, I'll Choose What I Work On, scroll down to Less Common Income, Sale of Home. Follow the interview to confirm your question.