Home sale exclusion

[Peking]

Is it permitted to amend a 2017 tax return to rescind an election to exclude the sale of a residence so you can exclude a sale in 2019?

[TaxGuyBill]

Yes.

[BobKamman]

I don't see any reference to an "election" in Section 121.  It says the gain "shall" be excluded.  However, if the two sales were not 24 months apart, the exclusion on the second home can be pro-rated if the sale was "by reason of a change in place of employment, health, or, to the extent provided in regulations, unforeseen circumstances."

[TaxGuyBill · Accepted solution]

§121(f) and §1.121-4(g).

[BobKamman]

Well, yes, but who the (f) reads that far?  If the exceptions in (c) apply, then take two bites of the apple and not just one.  

[Peking]

Thanks for the info. I'm going to amend the 2017 and if they cash the check we'll claim the exclusion for 2019. No reasons to prorate the exclusion are applicable in my situation.