Updated about 6 years ago on .
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Avoiding capital gains 2/5 rule
Hi BP experts. Hoping to get some answers on a slightly complicated issue. I have asked a couple of accountants this question but they are not real estate specialists so I want to see what kind of answers I get here.
I am in the process of selling my investment property. It is an inherited property with no mortgage so I will be making quite a bit of profit from it. I lived in the home for 2 of the last 5 years. As I understand this would allow me to be exempt for the first $500,000 profit as a married couple. However, about 6 months ago I transferred the title into an LLC with myself as the sole manager. So the property was in my name and is now in the LLC owned by me. Does the 2/5 rule still apply? Or did transferring the property to the LLC start the clock over?