Solved: Can I take an exemption on selling my house in 2016. If I buy another house can I still take an exemption if I live in it for required time.
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clarkfrankw
New Member

Can I take an exemption on selling my house in 2016. If I buy another house can I still take an exemption if I live in it for required time.

It will be about another year or so before I buy another house to reside in.
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MichaelMc
New Member

Can I take an exemption on selling my house in 2016. If I buy another house can I still take an exemption if I live in it for required time.

Yes, you can exclude up to $250,000 of gain ($500,000 if married filing jointly) on the sale of your home if you meet the eligibility test. This exclusion can be taken again, without limit, so long as the eligibility test is met each time.

Eligibility Test

Determine whether any of the automatic disqualifications apply. Your home sale isn’t eligible for the exclusion if either of the following are true.

You acquired the property through a like-kind exchange (1031 exchange), during the past 5 years. See Pub. 544, Sales and Other Dispositions of As­ sets.

You are subject to expatriate tax. For more information about expatriate tax, see chapter 4 of Pub. 519, U.S. Tax Guide for Aliens. 

Ownership If you owned the home for at least 24 months (2 years) during the last 5 years leading up to the date of sale (date of the closing), you meet the ownership requirement.

Residence If your home was your residence for at least 24 of the months you owned the home during the 5 years leading up to the date of sale, you meet the residence requirement. The 24 months of residence can fall anywhere within the 5-year period. It doesn't have to be a single block of time. All you need is a total of 24 months (730 days) of residence during the 5-year period.

Look-Back If you did not exclude gain on the sale or exchange of a main home during the 2-year period prior to the date of the sale or exchange of your current home, you meet the look-back requirement. You may take the exclusion only once during a two-year period. [Emphasis added.]

For more information, please see IRS Pub. 523 Selling Your Home.

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1 Reply
MichaelMc
New Member

Can I take an exemption on selling my house in 2016. If I buy another house can I still take an exemption if I live in it for required time.

Yes, you can exclude up to $250,000 of gain ($500,000 if married filing jointly) on the sale of your home if you meet the eligibility test. This exclusion can be taken again, without limit, so long as the eligibility test is met each time.

Eligibility Test

Determine whether any of the automatic disqualifications apply. Your home sale isn’t eligible for the exclusion if either of the following are true.

You acquired the property through a like-kind exchange (1031 exchange), during the past 5 years. See Pub. 544, Sales and Other Dispositions of As­ sets.

You are subject to expatriate tax. For more information about expatriate tax, see chapter 4 of Pub. 519, U.S. Tax Guide for Aliens. 

Ownership If you owned the home for at least 24 months (2 years) during the last 5 years leading up to the date of sale (date of the closing), you meet the ownership requirement.

Residence If your home was your residence for at least 24 of the months you owned the home during the 5 years leading up to the date of sale, you meet the residence requirement. The 24 months of residence can fall anywhere within the 5-year period. It doesn't have to be a single block of time. All you need is a total of 24 months (730 days) of residence during the 5-year period.

Look-Back If you did not exclude gain on the sale or exchange of a main home during the 2-year period prior to the date of the sale or exchange of your current home, you meet the look-back requirement. You may take the exclusion only once during a two-year period. [Emphasis added.]

For more information, please see IRS Pub. 523 Selling Your Home.

View solution in original post

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