Capital Gain Tax on Sale of the House

5 replies
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My fiancé lived in my house for over 8 years (in California, I am the owner). We are planning to sell it this year. Will we qualify for the $500,000 exclusion on the capital gain if we get married during this year? Or do you need to be married for certain amount of time to be able to exclude $500,000 as a married couple?

Thank you!

Hal_AlAnswer

Level 15

Q. I thought that the requirement was that just one person of the couple has to own the house?

A. That is correct.

The second spouse only needs to have lived in the house for 2 years. He/she did not need to be the taxpayer's spouse for the whole two years. He just needs to be the spouse at the end of the year.

Critter-3

Level 15

Getting married will not work ... to exclude 250K each you both had to OWN & live in the home for 2 out of the last 5 years.

kaymarinaAuthor

Level 2

Yes, I owned the house for 12 years. My fiancé lived in it with me for 8 years. It has been his mailing address on all his accounts/files, etc. We just were not married.

What if we do get married this year and file jointly? By the time we file taxes next year, we would be married...

I thought that the requirement was that just one person of the couple has to own the house?

You think we still will not qualify for $500k exclusion?

kaymarinaAuthor

Level 2

*we just were not married

AmeliesUncle

Level 15

Yes, if you are married by the end of the year, you can exclude up to $500,000 of the gain.

Hal_Al

Answer

Level 15

Q. I thought that the requirement was that just one person of the couple has to own the house?

A. That is correct.

The second spouse only needs to have lived in the house for 2 years. He/she did not need to be the taxpayer's spouse for the whole two years. He just needs to be the spouse at the end of the year.