With home sales booming, sellers may qualify to exclude all or part of any gain from the sale of their main home. The main home is the one in which you live most of the time. Here are the primary requirements-

Ownership and Use Tests
To claim the exclusion, you must meet the ownership and use tests. This means that during the 5-year period ending on the date of the sale, you must have:
• Owned the home for at least two years (the ownership test)
• Lived in the home as your main home for at least two years (the use test)

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).

You cannot deduct a loss from the sale of your main home.

For more requirements see, https://www.irs.gov/businesses/small-businesses-self-employed/sale-of-residence-real-estate-tax-tips and https://www.irs.gov/pub/irs-pdf/p523.pdf

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