Home Sellers Partial Exclusion
One of the major dilemmas that both married and unmarried home owners face is what happens to the $250/500k capital gains tax exclusion if you sell your home after owning it or living in it for less than two years?
In these situations above you may be denied the $250k/$500k exclusion and have to pay tax on your home sale profits. If you have owned the home for less than a year you may even have to end up paying tax at your top income tax rate (up to 35%), instead of at the 15% long-term capital gains rate.