topic Prorating Primary Residence Gain - Bought '2006 sold in '2017. Rented it 2016 and '17. Is some of my gain taxable, on top of the tax on the deprecation that I took? in Investors & landlords

Prorating Primary Residence Gain - Bought '2006 sold in '2017. Rented it 2016 and '17. Is some of my gain taxable, on top of the tax on the deprecation that I took?

rayess007 — Tue, 04 Jun 2019 00:23:46 GMT

This was our primary residence for 9 years, and rented for the last 2 years before i sold it last year. Do I only pay taxes on the deprecation that i took for 2 years? How about the gain, do i need to do anything with that, since i qualify for the $500 K exclusion, as i met all the tests?

No, the exclusion is not prorated, so the only tax will b...

TaxGuyBill — Tue, 04 Jun 2019 00:23:48 GMT

No, the exclusion is not prorated, so the only tax will be on the depreciation (assuming the rest of the Gain is less than $250,000/$500,000).

However, based on your previous question, the TurboTax step-by-step interview is not set up to report this sale because the Fair Market Value (when it was converted to a rental) was lower than your Cost Basis. You may consider going to a tax professional to have it reported correctly.