Agnes,a calendar year taxpayer,lists her principal residence with a realtor on April 3,2010,enters into a contract to sell on May 28,2010,and sells (i.e. ,the closing date)the residence on June 30,2010.The realized gain on the sale is $212,000.Which date is the appropriate ending date in determining if the residence has been owned and used by the taxpayer as the principal residence for at least two years during the prior five-year period?
A)April 3,2010.
B)May 28,2010.
C)June 30,2010.
D)December 31,2010.
E)None of the above.

Question

Quizplus · Accepted Answer

The appropriate ending date in determining if the residence has been owned and used by the taxpayer as the principal residence for at least two years during the prior five-year period is the date of sale, which in this case is June 30, 2010. This is because the taxpayer owned and used the property as their principal residence until the date of sale, and the period of ownership and use must be at least two years in order to qualify for the capital gains exclusion for a principal residence. The other dates listed do not have any relevance in determining the length of ownership and use of the property.

Agnes,a Calendar Year Taxpayer,lists Her Principal Residence with a Realtor