Tax, SDIRAs & Cost Segregation

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George Liu
  • Houston, TX
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CPA help -;2 of 5 year rule

George Liu
  • Houston, TX
Posted Aug 8 2019, 07:25

For those that have done it before - I have a property that I previously lived in as a primary home from 2014-2016 that I'm looking to sell. The home has since been used as a rental - I was wondering if the 2/5 year rule would still apply in this case and if so how do you designate it as such on the forms to file the capital gains exemption? Thanks in advance for your help!

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Wayne Brooks#1 Foreclosures Contributor
  • Real Estate Professional
  • West Palm Beach, FL
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Wayne Brooks#1 Foreclosures Contributor
  • Real Estate Professional
  • West Palm Beach, FL
Replied Aug 8 2019, 07:35

Well, you have Exactly 3 years to Close on the sale, from the Day you moved out....assuming you lived in for at least 2 years (720 days).

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Eamonn McElroy#4 Tax, SDIRAs & Cost Segregation Contributor
  • Accountant
  • Atlanta, GA
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Eamonn McElroy#4 Tax, SDIRAs & Cost Segregation Contributor
  • Accountant
  • Atlanta, GA
Replied Aug 8 2019, 08:04

Publication 523 is a great guide if you intend to DIY.

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George Liu
  • Houston, TX
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George Liu
  • Houston, TX
Replied Aug 8 2019, 08:33
Originally posted by @Eamonn McElroy:

Publication 523 is a great guide if you intend to DIY.

Thanks Eamonn!  Read up on the eligibility requirements - doesn't look like it being a rental for 2 and half years is a disqualifying item for this exemption so I think I'm good to go.  Just need to figure out how to eventually fill it out on the returns.