Exceptions to the 2/5 Year Capital Gains Tax Rule on Sale of Primary Residences

As most people are aware, homeowners can usually sell their home and avoid capital gains taxes on their primary residence, if they have lived in the home for two out of the last five years, per IRS tax rules.  However, there are some exceptions to this rule to be aware of.

The current rules show that there may be exceptions in situations such as:
-needing to move for work reasons
-health-related reasons (including caring for a family member)
-death of spouse
-divorce
-gave birth to two or more babies from the same pregnancy
-became eligible for unemployment
-became unable to pay living expenses
-deployed for active duty.

There are plenty more notes on exceptions on the IRS page, and please note these rules are constantly changing and you’ll need to check again and verify accuracy.

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