Thumbs Up: Home Sale Exclusion

Physician's Money Digest, February15 2005, Volume 12, Issue 3

In the current hot real estate market,it's not unusual to have a homeincrease in price dramatically in just ashort time. For homeowners who sella house after living in it for 2 of theprevious 5 years, there's a sweet taxbreak. Married couples are exemptfrom any capital gains tax on the first$500,000 of any profit they make onthe sale of the house and singles geta $250,000 exemption. If you've livedin the house for less than 2 years, youcan still claim a partial tax exclusion ifyou sell because of "unforeseen circumstances,"including such things asnatural disasters, changes in employment,or divorce. Talk to your taxadvisor for more information.