Do you think "time lived together unmarried" in home could count towards time requirements of the "use test" for purposes of filing MFJ and excluding $500K of gain on sale of home?
Situation is: Client owned home since 1995, was married in 2004/5 (exact date is a critical fact I am waiting on from client). The couple sold the home in 2006 due to employment relocation. The spouse doesn't qualify fully under the Use Test if you look at time she occupied the home as married. But if we used the time they lived together in same house before getting married she would qualify under the Use Test.
Total gain is $550,000. Client excludes $250k, and spouse partial (at least) from date of marriage to date of sale under the reduced exlcusion rules.
Even under reduced exclusion (using date of marriage only) I'm looking at including a taxable gain of possibly $100,000....
(house was in CA)
Jay
Situation is: Client owned home since 1995, was married in 2004/5 (exact date is a critical fact I am waiting on from client). The couple sold the home in 2006 due to employment relocation. The spouse doesn't qualify fully under the Use Test if you look at time she occupied the home as married. But if we used the time they lived together in same house before getting married she would qualify under the Use Test.
Total gain is $550,000. Client excludes $250k, and spouse partial (at least) from date of marriage to date of sale under the reduced exlcusion rules.
Even under reduced exclusion (using date of marriage only) I'm looking at including a taxable gain of possibly $100,000....
(house was in CA)
Jay
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