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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10122
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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In May of 2013, I moved out of a house that I have owned since

Customer Question

In May of 2013, I moved out of a house that I have owned since 2009. My 2013 taxes show a different residence. I am thinking of selling the house this summer and wonder if I can still prevent capital gains taxes based on living there for 2 of the last 5 years. When is the exact cut off for residency and how is it proven?
Submitted: 7 months ago.
Category: Tax
Expert:  Lane replied 7 months ago.
Hi,...The way the test works (the way the law is written, literally) is that you must have lived in the house for ANY 24 months (not necessarily continuously) out of the last five years before the sale...."(a)ExclusionGross income shall not include gain from the sale or exchange of property if, during the 5-year period ending on the date of the sale or exchange, such property has been owned and used by the taxpayer as the taxpayer’s principal residence for periods aggregating 2 years or more" (26 U.S. Code § 121 )
Expert:  Lane replied 7 months ago.
You don't prove this unless you are audited ... items that will be considered are mail delivery, voter registration, affidavits, etc ... IRS will say this is a facts and circumstance test ... again only if you were audited .. this is something that is simply reported, (nothing is filed with the return, in terms of proof)
Expert:  Lane replied 7 months ago.
Did you see my answer?

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