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Financial Planning / Tax Strategies
|Subject: Does home sale exclusion apply to me?||Date: 5/2/2000 8:04 PM|
|Author: Conspirator23||Number: 35306 of 124470|
TMF Taxes gave a number of excellent examples on who does and who does not apply for a Home Sale exclusion. On first glance, methinks that we do not. However, on second glance, methinks that we qualify for a partial exclusion. I'd like to get some feedback on that. Here's the scenario:
We purchased our home on in August of '97. I took a job in another state *almost* two years later, and we moved in May of 99. Rather than sell the home (we figured we would return after a few years) we rented the house out (at a significant loss. Just enough to cover our new lower living expenses, rather than the old mortgage) to family.
This year, when we filed our 99 return, we reviewed the IRS rules and determined that we passed the test for our rental activities being not-for-profit. Thus we applied the rent to the misc. income line on the 1040, skipped depreciation, and took our mortgage interest as an itemized deducation as normal.
Well, the family members are now moving on, and rather than go through the trouble of renting the place out, we've decided to sell. (Side note: No, I haven't been promoted to putting the almonds on the cookies. We've decided that the house itself is not a keeper.) What I'm wondering is that since we passed the test and the house never became a rental properly, do we qualify for a partial exclusion due to the employment change?
Otherwise, the only thing I can think of that would qualify us for the exclusion would be to move back in for 3 months. :-)
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