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posted Apr 7, 2025 12:30:28 PM

the software incorrectly states that i owe taxes on the sale of a primary residence when I don't

I sold a primary home after living in it six years. the gain is well under the 250k profit exclusion amount; its approximately 60k yet turbo tax says I don't qualify for the exclusion. What is going on?

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1 Replies
Expert Alumni
Apr 7, 2025 4:13:41 PM

You should go back and check your entries.  You must meet both the ownership test and the use test to get the exclusion. If you answered one question wrong, the program will disqualify you.  To review the entries:

  1. Open your return
  2. Go to the Wages & Income section
  3. The Sale of the Home section is under the Less Common Income

Review your entries. There are questions about the time you lived at your home, if you used it for business or as a rental, If you had another sale of a home recently  property in the past couple of years, and if you bought your house as a like exchange.  All these will affect whether you qualify for the exclusion.  See the links and images below for your reference:

 

How does selling a home affect my taxes?

Topic no. 701, Sale of your home