Brief questions on the ‘2 years of ownership’ capital gains exemption on residential real-estate.
Is is true that this exemption is for primary residence (house your living in, only)?
Do you have to buy a new house within a specific period of time, ie., within two years?
Apologies for the extreme newbieness. Google didn’t help me.
Go to www.irs.gov that is the IRS web site! type in Capital gains in the search!
I know it is up to 250k single person and 500k married couple every two or three years!
on your personal property only! Hope this helps…
Robb
The expemption is only for your ‘main home’ which means the home you currently live in.
You can claim exemptions if you have owned the home for at least 2 years and if you have resided in the home for at least 2 of the previous 5 years (from the date of the sale) - this passes both the Ownership and Use test.
The exemption is $250,000 for single or $500,000 for married couples.
You cannot deduct any losses on your personal home however.
See I was really close!!!
Robb
…and, “NO”, you don’t need to reinvest the money…it is yours to do with as you wish…
Keith
Yep, a 1031 exchange would be silly for instance if it met both the ownership and use test.
Actually, that was a part of his original question (“Do you have to buy a new house within a specific period of time, ie., within two years?”)…!
Keith
I know, I was agreeing with you 
If two individuals owned a property jointly, do each of them get up to the $250,000 exemption?