Significance of "principal residence" question on QuitClaim deed?

[George Eliot]

Hi everyone,

I'm a soon-to-be first time homeowner once my father gives me a house he owns via a quitclaim deed. I am just wondering if there are any legal/financial (as far as taxes go) implications in answering "Yes" or "No" for "This property is intended as my principal residence."

I am planning on renting it once I make a few improvements on it, so should I select "No"? I am concerned because in case I want to sell the house at some point, I'd like to reduce my capital gains taxes as much as possible.

Thanks very much for any advice you can give.

[Steve Babiak]

A principal residence can get a homestead discount on the property taxes in some jurisdictions. You're starting to let some money interfere with honesty here ...