Selling a home is a less taxing prospect since the 1997 tax law changes – literally. If you’re married, you can exclude up to $500,000 of the profit from the sale. If you’re single, you can exclude up to $250,000.

 

Qualifying is simple: you must have owned and lived in the house for two out of five years before the sale. And this is not a one time exclusion: you can use this exclusion every time you sill a house, as ling as you haven’t sold another house in the last two years. If you’re married, you have to meet additional requirements to take the $500,000 exclusion:

 

You must file a joint return

 

You or your spouse, or both must own the house

 

You and your spouse must have lived in the house

 

(There are also exceptions where you may be able to take the exclusion if you don’t meet the ownership and use tests and you may be able to take a partial exclusion even if you can’t take the whole exclusion.)  For more information visit the IRS web site at: www.irs.gov/publications/p523/index.html

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