Can a house owned for 3 years but on rent for 2 years (then sold) qualify for sale as residential home?

Forum|Forum|6 years ago
December 7, 2019
3 replies
21 views

Client bought a residential home in June 2016 , lived in it for 6 months and then gave on rent from 01/01/2017 until he sold it on 09/30/2019.

Can he now regard the sale as personal residential home and avoid the capital gain tax?

ProSeries Basic

This topic has been closed for replies.

Best answer by Just-Lisa-Now-

If they lived in it for 24 months out of the last 60 months before sale, it can qualify for IRC121, there will still be some depreciation to recapture from the time it was a rental though.

George4Tacks

Level 15

Why did they only live there 6 months? Move? Divorce? That may impact the answer.

Answers are easy. Questions are hard!

Accountant-Man

Level 13

No. You've answered it yourself. The law says owned AND lived in it for 24 months. They didn't, so unless they moved for a certain specified reason for leaving, no exclusion.

** I am "Elevating with Intention!"

Just-Lisa-Now-

Answer

Intuit Community Champion

If they lived in it for 24 months out of the last 60 months before sale, it can qualify for IRC121, there will still be some depreciation to recapture from the time it was a rental though.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

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