divorce & exclusion of gain from sale of principle residence

[jmc]

H & W are divorced during 2006.

From selling their principle residence, $600,000 is the capital gain meeting exclusion requirements. Normally, only $250,000 exclusion is available when they file single/HOH return individually. One factor is that they agreed each other for only the Husband report 100% of the gain. Can the Husband exclude $500,000?

[jainen]

attorney earned her fee

>>Can the Husband exclude $500,000?<<

Obviously a single person can only exclude up to $250,000. The rest of the arrangement is simply a property division in the divorce. Too bad he didn't bring the agreement to you first. It would appear that his ex-wife's attorney earned her fee.

[jimmcg]

Hopefully there was a quid pro quo benefit to the husband in the property division in return for the tax bite. If not, as Jainen implies, sounds like malpractice on the husband's attorneys part.

[jainen]

All I meant

>>Jainen implies, sounds like malpractice<<

All I meant was that the OTHER attorney did a good job. That doesn't mean there was any malpractice. We have no idea what the guy's goals were. After all, he got the house, which is a point many men lose. For all we know, he may be thrilled that he was able to hang on to the $250,000 exclusion. The wife lost her exclusion completely.

[jimmcg]

That's what I meant by quid pro quo.