Sale of a Principal Residence as Income


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What is the maximum possible amount of profit exempt from taxes on the sale of a principal residence?

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1. Long-term capital gains taxes apply if a personal residence is sold between _____ and two years of ownership.

2. How much time must a person live in a personal residence to qualify for an exemption from taxes on the profits of the sale of that home?

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About This Quiz & Worksheet

These study tools will quiz your understanding of home sale as income. You'll be assessed on topics like the maximum amount of tax-exempt profit on a home sale and when taxes for long-term capital gains apply.

Quiz & Worksheet Goals

Answer questions on the following study points:

  • Qualifying for exemption from taxes for the sale of a home
  • A law that relates to this exemption
  • Who is eligible for suspending the five-year test period for tax exemption on a home sale for up to a decade

Skills Practiced

  • Reading comprehension - ensure that you draw the most important information from the related lesson on home sale as income
  • Information recall - access the knowledge you've gained regarding long-term capital gains taxes
  • Knowledge application - use your knowledge to answer questions about various tax exemptions for the sale of a property and the law that stipulates exemptions

Additional Learning

Use the accompanying lesson called Sale of a Principal Residence as Income for more on these topics of interest:

  • Difference between short-term and long-term capital gains
  • Definition of a principal residence
  • Analysis of tax exemptions for home buyers and sellers