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Author: jonisback Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121585  
Subject: Taxpayer Relief Act of 1997? Reduced Exclusion Date: 7/22/1999 6:12 PM
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I recently found out that I paid capitol gains on $31,000 that I should have been excempt from.
I found this out in an article in the Motley fool. The quote is:
Reduced Exclusion

Well, what happens if you are unable to meet the "own and use"
restrictions. Does that mean that you lose the entire exclusion?
Nope. Not at all. If you can't meet the restrictions, you may still be
able to exclude part or all of your home sale gain if EITHER of the
following conditions exist:

1. You owned your residence on August 5, 1997 and sold it after
that date but before August 5, 1999. Your reason for selling the
residence is immaterial.

2. You fail to meet the "own and use" qualification and/or the "only
once every two years" qualification because you had to sell the
home due to a change of your place of employment, health, or
because of other unforeseen circumstances.

Example: Tom bought his home in May 1997. In January of 1998
Tom sold the home and decided to move to Costa Rica and retire.
Even though Tom did not meet the 2-year "own and use" test, he
may still be able to exclude part or all of his gain because exception
1 above was met (he owned the home on August 5, 1997, and sold it
before August 5, 1999).

I meet condition #1 above and the accountant that did my taxes is not aware of the reduced exclusion and would like to have some documentation he can reference. Does anyone know where you can get information on this?

Best Regards,

Jon
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