Can a property we've rented out qualify for capital gains exclusion?
August 21, 2008
Date: 19 Nov 2007
My wife and I purchased a rental property in 1975. We lived in it from 1975 to 1978, and then rented it out to the present.
Do we qualify for the capital gains exclusion if we sell the property in 2008?
Date: 27 Nov 2007
No. The general rule is in order to qualify for the exclusion for the sale of a principal residence, you must have owned and used the property as your principal residence for periods aggregating two years or more during the five years ended on the date of the sale or exchange. Since it's been nearly 30 years since you used the property as a residence, it doesn't qualify for the exclusion.
We have more answers to frequently asked real estate tax questions! We also offer up-to-date information about new tax real estate tax developments in Michael Gray, CPA's Real Estate Tax Letter.
Find us on Facebook
Follow me on Twitter
Connect on LinkedIn
Connect on Google+