Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

Reduced tax free gain on home sale…

Posted by taxguru on April 23, 2008


I came across your information on the web and was wondering if you could clarify what the pro-rated capital gains exclusion (amount) is for selling your primary residence less then 2 years. Is this $342.47 per day, per person for the length of time that you lived in the house before selling?

I would be happy to compensate you for your advice.




The tax free gain does work out be $342.46 per day that you both owned and lived in the home as your primary residence.  This is $250,000 divided by 730 days.

IRS has a worksheet for calculating the reduced excludable gain in Publication 523 on their website.   

Most professional tax software has the capability to calculate this based on the number of qualifying days; so be sure to give that figure to your personal professional tax preparer.

Good luck.

Kerry Kerstetter


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