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It depends.
TurboTax asks about your primary home sale because if the home was either a rental or a home office expense was taken some time in the past, the IRS requires the recognition of a capital gain on the recapture of previously taken depreciation expenses (even if a person is claiming the home gain exclusion).
So according to the IRS, when you sell a property that was used as a rental or taken a home office expense and took a depreciation expense in a prior year, you must pay 25 percent recapture tax (also referred to as Section 1250 recapture) as well as regular state income tax on the depreciation you claimed. (Remember the IRS will assume that you claimed the correct amount of depreciation every year—this is true regardless of whether you actually claimed any depreciation on your tax return).
However, you do not need to enter the sale of your primary residence if:
You can take the gain exclusion as long as you considered the home your "primary residence" for 2 of the last 5 years. If you have a capital gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income. You may qualify to exclude up to $500,000 of that gain if you file a joint return with your spouse. See Sale of Your Home for more information on the exclusion.
If you still need to enter your sale of your primary residence, please follow these steps:
Say "yes" that you sold your main home and TurboTax will guide you on entering this information. You will need:
Just remember to check the box to have your home sale reported on your tax return but ONLY if you receive a 1099-S
It depends.
TurboTax asks about your primary home sale because if the home was either a rental or a home office expense was taken some time in the past, the IRS requires the recognition of a capital gain on the recapture of previously taken depreciation expenses (even if a person is claiming the home gain exclusion).
So according to the IRS, when you sell a property that was used as a rental or taken a home office expense and took a depreciation expense in a prior year, you must pay 25 percent recapture tax (also referred to as Section 1250 recapture) as well as regular state income tax on the depreciation you claimed. (Remember the IRS will assume that you claimed the correct amount of depreciation every year—this is true regardless of whether you actually claimed any depreciation on your tax return).
However, you do not need to enter the sale of your primary residence if:
You can take the gain exclusion as long as you considered the home your "primary residence" for 2 of the last 5 years. If you have a capital gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income. You may qualify to exclude up to $500,000 of that gain if you file a joint return with your spouse. See Sale of Your Home for more information on the exclusion.
If you still need to enter your sale of your primary residence, please follow these steps:
Say "yes" that you sold your main home and TurboTax will guide you on entering this information. You will need:
Just remember to check the box to have your home sale reported on your tax return but ONLY if you receive a 1099-S
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