May time a homeowner resides in a licensed Nursing Home be used in lieu of time physically occupying a home to meet residency requirement re: capital gains under 250k?

[Coleen3 · Accepted solution]

Yes.

If you have a disability, and are physically or mentally unable to care for yourself, you only need to show that your home was your residence for at least 12 months out of the 5 years leading up to the date of sale. In addition, any time you spend living in a care facility (such as a nursing home) counts toward your residence requirement, so long as the facility has a license from a state or other political entity to care for people with your condition.

[Jonathan1]

Does your response remain valid even if the person has NOT lived in her primary residence at all for the past 6 years?

[Coleen3]

The IRS says "any time you spend living in a care facility (such as a nursing home) counts toward your residence requirement." This still has to be within the 5 year time span.

[Jonathan1]

Thank you Colleen.  Thank you for your patience and help.  So, as you interpret it, if the person spent ALL her time in a licensed Nursing Care facility within the 5 year time frame - this meets the IRS requirement?  During the 5 year time span, the person NEVER lived in her residence.  The entire amount of time, for the 5 year time span was spent in a licensed Nursing Care Facility.

[Coleen3]

That's how I read it.