I am selling my house and I have been in the house for a little under two years. I will be making a profit of about 50K. Can you tell me what taxes I am looking at?

First, be sure that you can't qualify for at least a part of the exclusion because of special circumstances.

You don't have to count temporary absences from your home as not living there. You're permitted to spend time away on vacation, or for business or educational reasons, assuming you still maintain the property as your residence and you intend to return there.

And you might qualify for a partial exclusion if you're forced to move due to circumstances beyond your control. For example, you could exclude a part of your gain if your work location changed so you were forced to move before you'd lived in your house for the qualifying two years. This exception would apply if you started a new job, or if your current employer required you to move to a new location.

Document your condition and the situation with a statement from your physician if you're forced to sell your house for medical or health reasons. This, too, allows you to live in the home for less than two years yet still qualify for the exclusion. You don't have to file the letter with your tax return, but keep it with your personal records just in case the IRS wants confirmation.

You'll also want to document any unforeseen circumstances that might force you to sell your home before you've lived there the required period of time. According to the IRS, an unforeseen circumstance is "an event that you could not reasonably have anticipated before buying and occupying your main home."

Natural disasters, a change in employment that left you unable to meet basic living expenses, death, divorce, and multiple births from the same pregnancy would all qualify as unforeseen circumstances under IRS rules.

Active duty service members aren't subject to the residency rule. They can waive the rule for up to 10 years if they're on qualified official extended duty—the government ordered you to reside in government housing for at least 90 days, or for a period of time without a specific ending date. You'll also qualify if you're posted at a duty station that's 50 miles or more from your home.

As for taxation, any profit from the sale of your home is reported on Schedule D as a capital gain if you realize a profit in excess of the exclusion amounts, or if you don't qualify for the exclusion. The gain is reported as a short-term capital gain if you owned your home for one year or less. It's reported as a long-term gain if you owned the property for more than one year. 

Short-term gains are taxed at the same rate as your regular income, according to your tax bracket. The rates on long-term gains are more favorable: zero, 15%, or 20%, depending on your taxable income. The IRS indicates that most taxpayers pay no more than the 15% rate.