topic Rental Property Sale - Partial Exclusion of Gain in Investors & landlords

Rental Property Sale - Partial Exclusion of Gain

questionsaboutmytaxes — Wed, 11 Feb 2026 04:22:38 GMT

Turbotax is not clear in how it asks the question and I am unsure of what to answer. They ask for the reason the rental property was sold, and I can click health reasons, I had health issues that caused us to move states and decide to sell the rental property. However, it is unclear if we had to live in the property at the time of sale to qualify for a partial exclusion of gain.

Re: Rental Property Sale - Partial Exclusion of Gain

DianeW777 — Wed, 07 Feb 2024 22:32:47 GMT

An exclusion would not apply to rental property. It applies only to the sale of your home that you lived in for 24 months of the last five years.

The questions in TurboTax are whether you purchased the property and for the year of sale, most importantly, check the box that it was sold, retired, stolen, destroyed.....

Enter Date of sale

Continue to follow the step-by-step interview.

TurboTax will calculate the gain on the sale and the full amount of depreciation.

If you indicated you did live in this rental property as your main home, please provide additional details here and we will help further.

Re: Rental Property Sale - Partial Exclusion of Gain

Carl — Thu, 08 Feb 2024 03:45:03 GMT

An exclusion would not apply to rental property.

Not quite accurate. I think both of you are just not on the same page.
If one is selling rental property, and it "was" their primary residence for at least two of the last five year's they owned it, counting back from the closing date of the sale, then they qualify for the exclusion, and a partial exclusion if certain criteria is met.
So the sale of a rental property is being reported, since most likely the property was the seller's primary residence for a period of time before they converted it to a rental, and that period of time is within the last 5 years they owned it. So they qualify for the partial exclusion if the criteria are met.