On August 8, 2014, Sam, single, age 62, sold for $210,000 his principal residence, which he has lived in for 10 years, and which had an adjusted basis of $60,000. On November 1, 2014, he purchased a new residence for $80,000. For 2014, Sam should recognize a gain on the sale of his residence of:

Question

Quizplus · Accepted Answer

Sam qualifies for the exclusion of up to $250,000 of gain from the sale of his principal residence because he is single and has lived in the home for at least 2 of the last 5 years. The gain is $150,000 ($210,000 - $60,000), which is fully excluded, so he recognizes $0 gain.

On August 8, 2014, Sam, Single, Age 62, Sold for $210,000