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egryn
New Member

Capital gains exclusion for 2 homes within 2 years (active military)

Hello community!

We sold a rental in Nov 2023 that we purchased in 2010 and lived in until Dec 2015.

We are now selling another property this month (Jun 2024) due to military retirement (which I believe is considered a PCS).

 

- that means selling 2 primary homes within 2 years

- both properties can be considered primary homes based on the "use" exclusions for military

- we have not yet claimed the capital gains exclusion on the Nov 2023 sale

 

Are we required to pay capital gains tax on one of these properties?  The IRS sites says: "Generally, you're not eligible for the exclusion if you excluded the gain from the sale of another home during the two-year period prior to the sale of your home."  

- What does generally mean?  To me it means there are exclusions/exceptions to rule, but having difficulty finding what those exclusions are.  Pub 523 was helpful but didn't answer the question.

- would the second sale qualify for partial exclusion (since I am now retired as of this year)?

 

Any help that anyone can offer would be appreciated immensely.

 

Thanks

Eric

 

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1 Reply
M-MTax
Level 11

Capital gains exclusion for 2 homes within 2 years (active military)

What does generally mean?  To me it means there are exclusions/exceptions to rule

There are exceptions. Here --> https://www.irs.gov/publications/p523#en_US_2023_publink100073096

 

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