Home Sale 3x During Year


A

Al Bundy

I created a scenario in TaxCut Premium where the only income is selling a
main home 3 times during the year. The tax software doesn't even put the
3rd on the Sch D nor include it in the 1040 income. When you print out the
return along with it's notes, it indeed does print a worksheet for each of
the 3. The bottom line of the 3rd worksheet does say that it is taxable
gain (not excluded).

Either there is some tax law I don't know about or the program is messed
up. I suspect the latter but want to run it by people.

Thanks...
 
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P

Paul A Thomas

Al Bundy said:
I created a scenario in TaxCut Premium where the only
income is selling a main home 3 times during the year.
Isn't is illegal to sell the same home three times?

The tax software doesn't even put the 3rd on the Sch D
nor include it in the 1040 income. When you print out the
return along with it's notes, it indeed does print a worksheet
for each of the 3. The bottom line of the 3rd worksheet
does say that it is taxable gain (not excluded).

Either there is some tax law I don't know about or the program
is messed up. I suspect the latter but want to run it by people.

If you indeed sold three different homes, it's possible that the first would
qualify for the 2 out of 5 year exclusion rules, and therefore some amount
of gain be excluded from income, but for sure there's not any way the other
two sales could be excluded (assuming they were sold for a gain).

The only thing I can tell you to do is to check your input data very
carefully.
 
A

Al Bundy

Isn't is illegal to sell the same home three times?




If you indeed sold three different homes, it's possible that the first
would qualify for the 2 out of 5 year exclusion rules, and therefore
some amount of gain be excluded from income, but for sure there's not
any way the other two sales could be excluded (assuming they were sold
for a gain).

The only thing I can tell you to do is to check your input data very
carefully.
Thanks Paul.
Isn't is illegal to sell the same home three times?
Different homes. In this scenario, buy the home, move in, make
improvements, sell, move. Do this 2 more times. All would be ST gain.

So what I gather (and is what I was asking) is that there is nothing IRS-
wise that says you have to report it a different way.
 
A

Arthur Kamlet

Isn't is illegal to sell the same home three times?




If you indeed sold three different homes, it's possible that the first would
qualify for the 2 out of 5 year exclusion rules, and therefore some amount
of gain be excluded from income, but for sure there's not any way the other
two sales could be excluded (assuming they were sold for a gain).

I disagree.

The first home sale could meet the 2/5 rule, and each of the
following houses could meet one of the unforseen circumstances,
so gain would be prorated.

When unforseen circumstances are met, neither this sale nor next
sale meeting unforseen circumstances need meet 2/5 rule. As I
read it you could sell a house every month if each meets
unforseen circumstances and exclusion amount would be prorated.
 
P

Paul

Arthur Kamlet said:
I disagree.

The first home sale could meet the 2/5 rule, and each of the
following houses could meet one of the unforseen circumstances,
so gain would be prorated.

When unforseen circumstances are met, neither this sale nor next
sale meeting unforseen circumstances need meet 2/5 rule. As I
read it you could sell a house every month if each meets
unforseen circumstances and exclusion amount would be prorated.


True, but what are the odds....that all three homes meet the "unforeseen
circumstances", and have a gain to boot.
 
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A

Al Bundy

I created a scenario in TaxCut Premium where the only income is
selling a main home 3 times during the year. The tax software doesn't
even put the 3rd on the Sch D nor include it in the 1040 income. When
you print out the return along with it's notes, it indeed does print a
worksheet for each of the 3. The bottom line of the 3rd worksheet does
say that it is taxable gain (not excluded).

Either there is some tax law I don't know about or the program is
messed up. I suspect the latter but want to run it by people.

Thanks...

I confirmed with TaxCut support via several email dialogs that TC is f*d
up for this scenario when inputted using the interview. It underreported
income by 10k! They basically told me how to get around it.

Didn't even say thanks except for some canned header that was in every
email. Maybe next time I'll just send it off to PC Magazine after
confirming it's the software and not my tax ignorance.

We'll see if their scheduled Feb update fixes it.
 
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