Program is not giving me "Gain on the sale of home exclusion" (Active duty military suspending 5 year rule)

[John JL]

We bought our home in July 2011 and had to move due to military orders in June 2014 (therefore we lived in the home as our primary residence for 3 years). I continued on active duty stationed more than 50 miles from the home until I retired in October 2022 (therefore suspending the 5 year test period of ownership and residence for 8 years and 4 months).  We sold the home in July 2023 (9 months under the regular rules for  5 year test period of ownership and residence). 

The home was used as a rental from June 2014 until June 2023.

Should we have a "Gain on the Sale of Home Exclusion"?  If so, how do I ensure that the program reflects that correctly?

[DMarkM1]

You will qualify for an exclusion on the gain on the sale of your principle residence (up to 500,000 for joint filers) under the suspension for military service exception.  However, the property was a rental for 2014-2023 and the depreciation you could have taken over those years is not part of that exclusion.   

1. Using the "Sale of Home" topic in the "Less Common Income" dropdown  
2. Enter the purchase and sale information
3. Answer the questions about ownership and residence  
4. You will answer No, you did not meet the residence criteria initially.  
5. Later you will be asked about the reason for the sale 
6. Select "Other"
7. On the next page select the "Military service" item 
8. You will then be asked if you meet the residence requirement with the suspension  
9. Answer "Yes"  
10. Now the exclusion will be activated  
11. Next, you will be asked about any unqualified use  
12. Answer No  
13. Then you will be asked about using the property for business or rental  
14. Answer Yes  
15. You will be asked to enter the depreciation you could have taken during the rental period  
16. It does not matter whether you actually took the depreciation; you must claim it 
17. Continue
18. Your exclusion minus the depreciation recapture will be shown