Skip to main content
March 19, 2021
Question

Our bought date of our new home was a couple months after the sale of our old home. I can't get past this page. We lived with relatives during that period.

  • March 19, 2021
  • 2 replies
  • 0 views
No text available

2 replies

DaveF1006
March 19, 2021

It depends. To clarify, what questions on the page that you are having issues with? I think the questions are being asked is that you are involved in a Section 1031 Like Kind Exchange that will defer your capital gains from the sale of your first house. How you answer these questions will determine rather or not you can defer those gains.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"
Employee
March 19, 2021

You can’t do a section 1031 exchange on personal property, only on business property.

 

For the sale of your personal home, the IRS does not need to know or care whether you bought a new home or the date of the purchase, so you are clearly in the wrong section of the program. The old rule that you could postpone the capital gains on the sale of your residence by buying a new residence within a certain period of time was eliminated in 1997. Now the rule is much simpler. When you sell your personal home, you can exclude the first $250,000 of capital gains from tax, or $500,000 if you were married filing jointly, as long as you owned the home for at least two years and lived in the home as your main home for at least two years of the past five years.

 

In many cases, you don’t even have to report the sale of your personal home. If the gain is less than your exclusion amount and if you did not use the home in business or take depreciation and did not receive a 1099 – S statement at the closing, then you don’t even have to report the sale.