Military Sale of Home before 2 year capital gain exclusion

[mabell716]

Would we be able to be exempt from paying taxes on the gain on the sale of our primary residence if we are active military duty, owned less than 2 years, lived in North Carolina, with Texas as Primary State of Residence? I retired from military Jan 2024.

[DavidD66]

The military service exemption from residing in the house in two out of previous five years allows you to suspend the 5-year test period for ownership and residence.  It does not waive the two year residence period.  There is another exception that allows you to take a partial exemption if you took or were transferred to a new job in a work location at least 50 miles farther from the home than your old work location.  For additional information, see the following IRS Publication:  Publication 523, Selling Your Home