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raasla33
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If my husband died in 2018 and i sell our home in 2021, what exclusion would i get from capital gains? $250,000 or $500,000?

 
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2 Replies

If my husband died in 2018 and i sell our home in 2021, what exclusion would i get from capital gains? $250,000 or $500,000?

Since it would be over two years from the time of his passing your exclusion amount is $250,000

If my husband died in 2018 and i sell our home in 2021, what exclusion would i get from capital gains? $250,000 or $500,000?

Surviving spouses may exclude $500,000 of home-sale profits from taxes if they sell the house within two years of their spouse's death, as long as they owned and lived in the house for two of the five years before the spouse died.
 

So if he passed in 2018 an you sell in 2021 you are limited to $250K    however   you got a step up in basis in 2018 due to his passing  ... here is a very simple example:

 

You bought the home together for $100K so you each had a basis of $50K.

 

In 2018 the home is worth $400K  so you inherited  1/2 of the DOD FMV  which is $200K + your $50K basis for a total of $250K.   

 

Now you can sell the home for up to $500K  without paying taxes.   Of course this is a simple what if ... you also have to add in then closing costs to buy & sell and any improvements you made over the years you owned it.   

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