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Can I defer a capital gain when I have sold and purchased a vacation home?

I purchased a vacation home on 3/2017 for $147K and sold a previously owned vacation home on 7/2017 for $139K. The second home was owned for > 5 yrs and was used for personal usage only. The capital gain on the sale was $7K. How do I record the 2 transactions?

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Can I defer a capital gain when I have sold and purchased a vacation home?

You cannot defer gains anymore on personal use homes (that ended in 1998). You might be able to do a like-kind exchange (sect 1033) if you used the home as rental property, but that is very complicated and you would need to seek professional advice from a CPA, Enrolled Agent, or tax attorney.

Instead of the deferral in pre-98 law, current law allows an exclusion (section 121) of $250k ($500k married) of gain (not proceeds) if the home was your primary residence for a certain period of time. This only applies to your primary residence, not a vacation home.

If these were not primary  residences, you report the 7/17 sale as you would for any capital asset. You do not report the 3/17 purchase, though you should keep all of your record regarding your costs for future sale. See this TT FAQ for how to enter into TT:

You can deduct real estate taxes and mortgage interest for the vacation homes subject to some limitations.

Some useful information here:

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