Selling a home

[Cmdjmyers]

My wife and I sold our home in July. This is the 1st time we have sold a home. We wonder what we are looking at for taxes when we file. What all do we need to know. 

[NateTheGrEAt]

Hi Cmdjmyers,

Congrats on the sale of your home! That's a big move. 

TurboTax has a great article that covers the basics of selling a home and how it may impact your taxes. I would encourage you to take a look at it. https://turbotax.intuit.com/tax-tips/home-ownership/tax-aspects-of-home-ownership-selling-a-home/L6t...

Short answer - if you lived there and owned the home for at least 2 years, up to $250,000 of capital gain ($500,000 if married filing jointly) can be exempt. For most people who fall into this situation, the answer is the sale of their home doesn't result in any taxes due at all. 

If you did not live there or own for 2 years, the answer is a bit more complicated, but the article does a great job of explaining some of the nuances.

Please post any specific questions here and I or one of the other experts will be glad to help!

[DoninGA]

If you sold your primary personal residence and you lived in and owned the home for at least two years in the five year period on the date of sale, you do not have to report the sale if your gains are less then the exclusion amounts of $250,000 if filing Single or $500,000 if filing Married Filing Jointly (and both lived in the home for two years).

If you had a gain greater then the exclusion amounts then you would have to report the sale. Also, if you received a Form 1099-S for the sale either with a gain or a loss, the sale has to be reported.

[JandKit]

I see that I was a bit late with my reply:

There is an exclusion for selling your main home if you have remained in the home for two of the last five years at the time of the sale. If that is your case, You would qualify for a $250,000 tax exclusion if single and a $500,000 exclusion for married filing joint. This exclusion means that you would not pay any tax on the excluded amount. This exclusion can be used more than once if the time requirement is met.  Here are the test you will need to meet:

Ownership: You must have owned the home for at least two years (730 days or 24 full months) during the five years prior to the date of your sale. It doesn't have to be continuous, nor does it have to be the two years immediately preceding the sale. If you lived in a house for a decade as your primary residence, then rented it out for two years prior to the sale, for example, you would still qualify under this test.

• Use: You must have used the home you are selling as your principal residence for at least two of the five years prior to the date of sale.
• Timing: You have not excluded the gain on the sale of another home within two years prior to this sale.

Need more information? Check this link:

https://turbotax.intuit.com/tax-tips/home-ownership/tax-aspects-of-home-ownership-selling-a-home/L6t...