"CB" wrote:

- quote -

The exclusion is applied first to the dwelling unit property, with any
leftover amount applied to the sale of the lot. If the lot is sold first
any gain is fully taxable, requiring an amended return if it later meets the
requirements for exclusion.

The Regulation section is 26CFR § 1.121-(b)(3).

--
Phil Marti
Clarksburg, MD

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On May 18, 12:41 pm, CB <te...[at]tomochka.com> wrote:
- quote -

How would one handle the split transaction on one's tax returns if the
two sales were spread over more than one tax year? I mean besides
having to allocate the original basis between the two properties, how
do claim the exclusion? Would you claim it twice or would you have to
not claim it on the first sale and then claim it over both properties
when the second was sold?

TIA.

Casey

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Greetings,

We are selling our home of the last 15 years. The overall gain will
not exceed the $500K cap gains exclusion limit for a couple. We are in
the process of dividing the property into two tax lots, one with the
existing house, the other bare land. We have two scenarios for the
sale of these lots:

1. Single buyer purchases both lots - I assume (perhaps wrongly) that
in this case we figure the cap gains as if we'd sold the original
single lot as a whole. Yes?

2. Two buyers, each buying one lot - Are we able to avoid cap gains
tax if we do this?

Please advise and many TIA.

- Casey

========================================= MODERATOR'S COMMENT:
If your two sales are within 24 months of each other, you can
apply the 500,000 exclusion to the total sale of the two contiguous
properties.

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >