This publication explains the tax rules that apply when you sell
your main home. Generally, your main home is the one in which you live
most of the time.
If you have a gain from the sale of your main home, you may be able
to exclude up to $250,000 of the gain from your income ($500,000 on a
joint return in most cases). Any gain you cannot exclude is taxable.
You cannot deduct a loss from the sale of your main home.
Worksheets are included in the publication to help you figure the
adjusted basis of the home you sold, the gain (or loss) on the sale,
and the amount of the gain that you can exclude.
Reporting the sale.
Do not report the sale of your main home on your tax return unless
you have a gain and at least part of it is taxable. Report any taxable
gain on Schedule D (Form 1040).
Who may need to read chapter 3.
Chapter 3 of this publication explains the rules that applied to
sales before May 7, 1997. You may still need to know those rules, but
only if you sold your main home at a gain before May 7, 1997, and all
three of the following statements are true.
- You postponed the gain on the sale as described in chapter 3.
- The 2-year period you had to replace that home (your
replacement period) was suspended while you either:
- Served in the Armed Forces, or
- Lived and worked outside the United States.
- You have not already reported to the IRS your purchase of a
new home within your replacement period, or a taxable gain resulting
from the end of your replacement period, as described in chapter 3
under What To Report Now.
If all three statements are true or you have questions, see
Date of sale.
If you received a Form 1099-S, Proceeds From Real Estate
Transactions, the date of sale should be shown in box 1. If you
did not receive this form, the date of sale is the earlier of (a) the
date title transferred or (b) the date economic burdens and benefits
of ownership shifted to the buyer. In most cases, these dates are the
What is not covered in this publication.
This publication does not cover the sale of rental property, second
homes, or vacation homes. For information on how to report those
sales, see Publication 544,
Sales and Other Dispositions of
Comments and suggestions.
We welcome your comments about this publication and your
suggestions for future editions.
You can e-mail us while visiting our web site at
You can write to us at the following address:
Internal Revenue Service
Technical Publications Branch
1111 Constitution Ave. NW
Washington, DC 20224
We respond to many letters by telephone. Therefore, it would be
helpful if you would include your daytime phone number, including the
area code, in your correspondence.
First | Next
Publication Index | 2000 Tax Help Archives | Tax Help Archives | Home