Maximizing gain exclusion/deferral when selling a principal residence due to death, divorce or marriage.

From: The Tax Adviser | Date: February 1, 1997| Author: | Copyright information

Longer life expectancies and increased divorce rates have complicated the application of gain deferral and gain exclusion provisions under IRC sections 121 and 1034 to the sale of a principal personal residence. The one-time exclusion of $125,000 in gain available to taxpayers over 55 can be complicated by the prior use of the election outside of the marriage of the two taxpayers. Death of a spouse may change the application of section 121's use requirement. Additional provisions offer additional gain exclusion on dispositions incident to divorce.

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