NEW TAX LAW BENEFITS FOR HOME SELLERS

• New Law Allows $500,000 Tax Exclusion
• Individual taxpayers now may exclude up to $250,000 ($500,000 in the case of a married couple filing a joint return) of profit realized on the sale or exchange of a principal residence.
• Rollover and Over Age 55 Exclusion Rules are Eliminated
• Under the new tax law, there are no longer any requirements to roll over home sale proceeds and reinvest them into a home of equal or greater value in order to earn a tax exclusion. The Over Age 55 one time exclusion rules have also been eliminated.
• Some Reporting Requirements Eliminated
• The new law excludes sales of personal residences with a gross sales price of $500,000 or less ($250,000 or less for a single seller) from the requirement to report real estate sales to the IRS.
• New Benefit Available Once Every Two Years
• Taxpayers who have owned and occupied a home as a principal residence for at least two of the previous five years prior to any sale or exchange can take full advantage of the exclusion. (There is a special formula provided to give partial exclusion to those who cannot satisfy the two-year requirement.)

This information has been summarized.

For complete details, seek the advice of a CPA or other Tax Professional.