Your Life

Your Life

Major life milestones often have a major tax impact. Changes in your marital status, having a baby or adopting a child can have significant impact on your taxes. This is the place to ask questions about dependents, real estate, and other various scenarios that play a significant role in what taxes you pay.

Posts: 1
Registered: ‎09-06-2017

Sold a house, haven't bought a new one

So I purchased a house in 2012, lived in it until 2016, when I moved in with my husband.  Sold the house earlier this year (2017) at a small profit.  He and I were hoping to use the money as a down payment on a new house, but so far we have not found one and I am getting lots of conflicting tax info from family and friends.  If we do not find a house by the time we do our taxes, do I have to claim this house sale as income for 2017?  


In case it makes a difference, I purchased the home for $50,000 and sold it for $80,000.  


Thanks in advance to anyone who can give me some legitimate advice!

Trusted Council Member
Posts: 6,191
Registered: ‎02-23-2016

Re: Sold a house, haven't bought a new one

Hi verh1977,



Welcome to the H&R Block community.


So it seems like you may be thinking of 1031 exchanges which defer having to pay taxes on the gain from the sold property, however 1031 exchanges are not allowed for personal residences.


You may also have heard something or other about the exclusion of gain from the sale of a home from taxable income.  The rule here is that when you have lived in your home for at least two out of the last five years and you have owned your home for at least two out of the last five years, and you have not taken a exclusion of gain from the sale of a home in the last two years, you can exclude the first $250,000 worth of gain on the sale of your home from your taxable income.


When you sell a house you do have to report the gain on your tax return pretty much no matter what.  However, when you are eligible to exclude gain, an adjustment is made on Form 8949 to reflect the exclusion.  Enter the amount of gain to be excluded in Column G of Form 8949 as a negative number and enter code "H" in Column F.


If you have any other questions I'll be glad to help.



Senior Tax Advisor (Tampa, FL)