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 Previous Page: Publication 17 - Your Federal Income Tax - Capital Gains and Losses Next Page: Publication 17 - Your Federal Income Tax - Figuring Gain or LossUse to find additional instances of index items. |
Taxmap/pub17/p17-079.htm#TXMP12b2a946 Chapter 16 |
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You cannot exclude from income a gain from selling your main home after October 22, 2004, if you acquired the home in a like-kind exchange and sold it during the 5-year period beginning with the date you acquired the home. For more information, see Special Situations, later.
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If you change your mailing address, be sure to notify the IRS using Form 8822, Change of Address. Mail it to the Internal Revenue Service Center for your old address. (Addresses for the Service Centers are on the back of the form.)
If you have not deducted all the points you paid to secure a mortgage on your old home, you may be able to deduct the remaining points in the year of the sale. See Mortgage ending early under Points in chapter 25.
This chapter explains the tax rules that apply when you sell your main home. Generally, your main home is the one in which you live most of the time.
If you sold your main home in 2004, you may be able to exclude from income any gain up to a limit of $250,000 ($500,000 on a joint return in most cases). See Excluding the Gain, later. If you can exclude all of the gain, you do not need to report the sale on your tax return.
If you have gain that cannot be excluded, it is taxable. Report it on Schedule D (Form 1040). You may also have to include Form 4797, Sales of Business Property. See Reporting the Sale, later.
If you have a loss on the sale, you cannot deduct it on your return.
The main topics in this chapter are:
You may want to see:
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This section explains the term "main home." Usually, the home you live in most of the time is your main home and can be a:
To exclude gain under the rules of this chapter, you generally must have owned and lived in the property as your main home for at least 2 years during the 5-year period ending on the date of sale.
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If you sell the land on which your main home is located, but not the house itself, you cannot exclude any gain you have from the sale of the land.
On March 4, 2004, you sell the land on which your main home is located. You buy another piece of land and move your house to it. This sale is not considered a sale of your main home, and you cannot exclude any gain on the sale of the land.
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If you have more than one home, you can exclude gain only from the sale of your main home. You must include in income the gain from the sale of any other home. If you have two homes and live in both of them, your main home is ordinarily the one you live in most of the time.
You own and live in a house in the city. You also own a beach house, which you use during summer months. The house in the city is your main home.
You own a house, but you live in another house that you rent. The rented house is your main home.
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If you use only part of the property as your main home, the rules discussed in this chapter apply only to the gain or loss on the sale of that part of the property. For details, see Business Use or Rental of Home, later.
| Previous Page:
Publication 17 - Your Federal Income Tax - Capital Gains and LossesNext Page:
Publication 17 - Your Federal Income Tax - Figuring Gain or Loss Use
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