Do you know about this tax implication for homesellers?
05/15/2015 | Author: Editorial Staff
My client bought his home a few years ago, but now he wants to sell it and take advantage of the tax exclusion of up to $250,000 on the proceeds. What criteria does he have to meet to qualify for the tax exclusion?
The IRS allows a seller to exclude from his taxable income a gain of up to $250,000 on the sale of his home (or $500,000 if he is married filing jointly) if he:
- Owned the home and used it as his principal residence during at least two of the last five years before the sale;
- Didn’t acquire the home through a 1031 exchange during the past five years; and
- Didn’t exclude a gain on another home sold during the two years before the current sale.
Read more legal FAQs on texasrealestate.com.
The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.
While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on texasrealestate.com. Any legal or other information found here, on texasrealestate.com, or at other sites to which we link, should be verified before it is relied upon.